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Instructions: Use the figures from Getting to Know Your Company, Your Company's Risk and Return and Your Company's Bond Values and YTMs if you
Instructions: Use the figures from Getting to Know Your Company, Your Company's Risk and Return and Your Company's Bond Values and YTMs if you participated in these extra credit opportunities. Otherwise, use the following instructions to gather the necessary information. Cost of debt: Go to https://www.finra.org/finra-data/fixed-income/corp-and-agency/trade On the middle of the page, you will see a box that says "Quick Filters." Enter the name of the company. The name is case sensitive. Enter for example "Amazon" not "amazon" as "amazon" will not yield any results. Restrict your search to a 3-day window. For example, If you are working on the homework on November 15, set the search date 11/13/2023 to 11/15/2023. Click on "Show Results." If the search does not return any results, expand your search window by picking an earlier date. The first column on the table is labeled "Symbol." Companies have several issues outstanding with different maturity dates. The alphanumeric code that you see in each line in this column is a unique number that is assigned to each bond issue for the issuing company that allows investors to track information on a particular bond issue trading activity. You will need to click on each link under the Symbol column to find a bond that has a maturity date beyond 10 years from your search date and that has information in the Yield column (not left blank). Collect the symbol, YTM, the maturity date, and the trade date. Enter the information on the table. Cost of common stock: Go to Yahoo site listed above. Record the Beta for your company found in your company's Summary tab. Use the CAPM equation to find the cost of equity. Assume the nominal risk-free rate (r) is 4.0% and the market risk premium (RP) is 5.5% Market capitalization: Record the market capitalization figure that appears on your company's Summary tab in Yahoo Finance. P.S. Market capitalization refers to the total market value of the firm's outstanding common stock. For new information not appearing in previous assignments, go to the latest available company's annual balance sheet statement in Yahoo.com. Collect the following information: Long-term debt Assume that the target capital structure of the firm will remain the same as its current capital structure (in terms of the weights used). Use a tax rate of 25% Your Name: Your company's name Item (YTM), the maturity date, trade date, symbol (From CAPM) Market capitalization Long-term debt Your Response T-Mobile US, Inc. 5.028717%, 4/15/2027, 4/19/2024, TMUS4466801 Rs 4.0+(5.5)*.48= 6.64% 192.214B or $192,214,000,000 71,399,000 (Thousand) or $71,399,000,000 Assume that the market value of long-term debt is equal to its book value. What is the total market value of long-term debt plus equity? Make sure that what you calculation is consistent with how the numbers of presented. Are all components expressed in the same denomination? Billions, Millions or Thousands? If not, please adjust your figures to make sure your figures are consistent so there are no errors in the calculation. Wd-percent of debt used in its target capital structure. Show calculation W-percent of equity used in its target capital structure. Show calculation. Based on all information collected, determine the cost of capital for your firm. Show all calculations.
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