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Find the weighted average cost of capital for a firm with total asset value of $42.3M and total equity value on the books of $15M,
Find the weighted average cost of capital for a firm with total asset value of $42.3M and total equity value on the books of $15M, taken from their financial statements. The total value of the firm, estimated from its traded securities, is $138M. The firms stock is currently trading for $43 per share and the company has 1.9M shares outstanding. The companys bonds, which are considered long-term, have a YTM of 2% and the expected return for equity is 20.11% and their tax rate is 32.2%.
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