The purpose of this assignment is to familiarize the student with the different sources of funds that are commonly used in publicly traded companies in the Saudi Stock Market and to relate it to the agency theory.

Required:

* Choose any two stocks from the same sector in the Saudi stock market except banks or insurance co. Perform the following:

1. Calculate the weighted average cost of capital (WACC) for each stock using recent data.

2. Compare your calculated WACC to the average of the chosen sector.

3. Interpret your findings where you compare each stock with the sector in the context of Debt- to- Equity ratios and leverage benefits to shareholders.

** Specific instructions:

1. Show all your calculations.
2. All your submitted work should NOT exceed one page where it contains three paragraphs. (One Paragraph for each question).