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WACC of Rooster, Inc.

Rooster, Inc. has 9 million shares of common stock outstanding. The current price is $52 per share. Rooster also has two bond issues outstanding. The first bond issue has a face value of $80 million, has an 8 percent coupon, and sells for 104 percent of par. The second issue has a face value of $50 million, has a 7.5% coupon, and sells for 102 percent of par. The most recent dividend was $3.10 and the dividend growth rate is 7 percent. The tax rate is 35 percent. What is the company's WACC?

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Rooster, Inc. has 9 million shares of common stock outstanding. The current price is $52 per share.
Rooster also has two bond issues outstanding. The first bond issue has a face value of $80 million, has an 8 percent coupon, and sells for 104 percent of par.
The second issue has a face value of $50 million, has ...

Solution Summary

The WACC of Rooster, Inc is given.

$2.19