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This homework is to estimate the WACC of General Motors Corporation (GM) at the end of December, 2020. Collect the following data: Beta (use the

This homework is to estimate the WACC of General Motors Corporation (GM) at the end of December, 2020. Collect the following data:

  • Beta (use the current beta available at Marketwatch.com)
  • Stock price and number of basic shares outstanding at the end of December 2020
  • Interest-bearing debt from the 2020 balance sheet
  • Taxes and taxable income from the 2020 income statement
  • 10-year Treasury rate at the end of December 2020

Find the company's income statement and balance sheet from S&P NetAdvantage and then pick the cost of debt from 


https://ycharts.com/indicators/moodys_seasoned_baa_corporate_bond_yield

 

Using these data, calculate the weighted average cost of capital of the company. For the cost of equity, use a 6% market risk premium.

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