IBM company's Stock and Bond information is provided below:

• Bond Time to Maturity: 20-years; Annual Coupon Rate: 7.00%; PAR Value: $1,000; Currently trading at: $1,275.54; Corporate Tax Rate: 25.0%
• Preferred Stock Preferred Stock Price: $64.00; Preferred Annual Dividend: $3.50
• Common Stock (Method 1) Equity Beta: 1.2; Risk-free Rate: 3.00%; Market Risk Premium: 6.00%
• Common Stock (Method 2) Long-run earnings growth: 7.00%; Expected Dividend (in one year): $2.10; Current Stock Price: $57.66

The target capital structure of the company consists of 65.0% Common Stock, 25.0% Debt, and 10.0% Preferred Stock.

How much is IBMs Weighted Average Cost of Capital (WACC)?

Enter your answer in the following format: 0.1234;

Answer is between 0.0762 and 0.0937

Hint #1: Use 'Method2' for cost of common equity.

Hint #2: Cost of pre-tax debt is: 4.82%.