Exam1Q5 - Interest Expense $60.00 New Cost of Equity 11% 1)...

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Young Publishing Total assets $3,000 million Tax rate Operating income (EBIT) $800 million Debt ratio Interest expense $0 million WACC Net income $480 million Market-to-Book R Share price $32.00 EPS = DPS g 0% New Capital Structure: Debt 20% Equity 80% Value of new Debt $600.00 Before Tax Cost of Debt 10%
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Unformatted text preview: Interest Expense $60.00 New Cost of Equity 11% 1) Number of Shares Outstanding: 150 million shares 2) Number of Shares after the Repurchase 131.25 million shares 3) New EPS after Repurchase $4.51 4) New Stock Price $41.00 $6,150.65 40% 0% 10% 1 $3.20...
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This note was uploaded on 12/14/2010 for the course FIN 422 taught by Professor Sridharsundaram during the Fall '09 term at Grand Valley State University.

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Exam1Q5 - Interest Expense $60.00 New Cost of Equity 11% 1)...

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