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Find a large publicly traded company with market capitalization > $ 5 billion ( USD or CAD ) . The company can be located anywhere
Find a large publicly traded company with market capitalization $ billion USD or CAD
The company can be located anywhere in the world if their reports are available in English.
Make sure that the company has all the types of sources of capital that we have
discussed in the course common stock, preferred stock and bonds.
Make sure that the company has a dividend payment history of at least years, so
that you can calculate the dividend growth rate with some confidence.
Be especially careful about confirming that the company has issued preferred stock,
before finalizing your selection.
Please answer the following questions in your report:
Give a brief description of the company and its business and its overall
capital structure.
Calculate its cost of common stock using both the methods DGM and
CAPMSML Comment on why they are different. Which one would you trust
more in your calculation for the WACC and why?
Calculate its cost of preferred stock.
Calculate its cost of debt.
Calculate its Weighted Average Cost of Capital.
Show detailed calculations in the report.
Use all data as of the same date: for example, December of the previous year.
Your calculations will be incorrect if you use different data from different dates.
Make sure that it is a professional report.
Companies do not issue just one bond. They have MANY bonds. You must calculate
the cost of debt for all of these as an aggregate.
Sometimes companies may have more than one series of common stock. I
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