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HBM , Inc has the following capital structure: The common stock is currently selling for $ 1 5 a share, pays a cash dividend of
HBM Inc has the following capital structure:
The common stock is currently selling for $ a share, pays a cash dividend of $ per share, and is growing annually at percent. The preferred stock pays a $ cash dividend and currently sells for $ a share. The debt pays interest of percent annually, and the firm is in the percent marginal tax bracket.
a What is the aftertax cost of debt? Round your answer to two decimal places.
b What is the cost of preferred stock? Round your answer to two decimal places.
c What is the cost of common stock? Assume that the current $ dividend grows by percent during the year. Round your answer to two decimal places.
d What is the firm's weightedaverage cost of capital? Round your answer to two decimal places.
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