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Category > Business & Finance Posted 15 Aug 2017 My Price 9.00

Equations Cost of Equity (Common Stock) The calculation used for Cost of Equity is the Capital Asset Pricing Model (CAPM).

Please assist me in determining the proper responses for the following calculations for Starbucks based on their 2016 Annual Report. I have also attached what I have attempted so far, but I am not confident in my calculations.

 

Thank you!

 

This section is to be divided up based on the topics. In each section, you must show and explain the equations that are used. In addition, you are to draw any conclusions on the company you can from this data. Please note that detailed worksheets showing all of the calculations for this section are to be included in an appendix.

 

·        Cost of Equity (Common Stock)

o  Beta  from Regression and two Betas from analysts  

o  Beta Chosen for CAPM and why

o  Capital Assets Pricing Model (include how determined RF and[ RM  or (RM – RF)]

o  Discounted Cash Flow (DCF) (only if dividends – include how determined)

o  Own-Bond-Yield-plus-Judgmental-Risk-Premium (include how determine risk premium)

·        Cost of Preferred Stock

·        Cost of Debt (make sure to include table that lists all bond issues with weighted average cost of debt)

·        Market Value of Debt (will have calculated above, but will need to add any long   term leases from balance sheet to get total market value of debt)

·        Market Value of Equity

·        Market Value of Preferred Stock

·        Value of Firm

·         Firm’s Tax Rate (explain how determined)

·        Weight for Equity

·        Weight for Preferred Stock

·        Weight for Debt

·        WACC (Weighted Average Cost of Capital) 

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Martinakom
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Status NEW Posted 15 Aug 2017 02:08 PM My Price 9.00

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