Some of the numbers are given in the exhibits and some are not, how do you get the scale total, mrp, cost of equity and the wacc. also, how do you get the cash flows given the coupon discount?

Case 4 H. J. Heinz: Estimating the Cost of Capital in Uncertain Times Advance questions 1. What are the major building blocks (components) for the estimation of cost of capital for a firm? What are the major models that we can use to estimate each component? 2. Yields on the two representative Heinz debt issues as of the end of April 2010 and 2009? 3. WACC for Heinz at the start of fiscal year 2010 and 2009? 4. What is your best estimate of the WACC for Kraft Foods, Campbell Soup Company, and Del Monte Foods? - How do these WACCs influence your thinking about the WACC for Heinz? YTM Calculation Based on Cash Flows 2032 Issue Timeline 0 0.5 1 1.5 2 2.5 3 3.5 Coupon 6.750% YTM based on 2010 price 3.375 3.375 3.375 YTM based on 2009 price 2011 Issue 5.43% -116.9 3.375 3.375 3.375 3.375 7.54% 3.375 3.375 3.375 Coupon 6.625% YTM based on 2010 price YTM based on 2009 price -91.4 3.375 3.375 3.375 3.375 3.312 3.312 3.312 3.312 1.06% -113.7 5 5 5 5 103.3125 3.312 3.312 3.312 3.312 1.74% -116.5 5 5 5 5 3.3125 3.3125 103.3125 Representative Bond Yields 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 2003 2004 2005 1-Year 10-Year 2006 30-Year(1) 2007 Moody's Aaa 2008 2009 2010 Moody's Baa Baa Credit Spread Over 10-Year Rate 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 2003 2004 2005 2006 2007 Baa Credit Spread Over 10-Year Rate 2008 2009 2010 Concluding remarks Impact of equity & bond markets changes on the WACC estimates - Risk-free rate, Beta, market risk premium The use of long-term vs short-term bonds in estimating cost of debt The use of comparable firms WACC captures the return from alternative (similar) investments at any point in time Best Practices\" in Estimating the Cost of Capital: An Update