Anzio, Inc., has two classes of shares. Class B has 5 times the voting rights as Class A. If you own 12% of the Class Ashares and 21% of the Class B shares, what percentage of the total voting rights do you hold?The percentage of the total voting rights that you hold is%. (Round to one decimal place.) Assume Evco, Inc. has a current stock price of $48.23 and will pay a $2.15 dividend in one year; its equity cost of capitalis 17%. What price must you expect Evco stock to sell for immediately after the firm pays the dividend in one year tojustify its current price?We can expect Evco stock to sell for $(Round to the nearest cent.)

Shareholders, as owners of the company, have a financial stake in the organization and typically…

Answered: Anzio, Inc., has two classes of shares.…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Silicone Systems Inc. shares are trading for $500. Analysts expect Silicone to generate net income of $41.7 billion. Silicone has 900 million shares outstanding. The average P/E ratio of Silicone's competitors is 18. What is the fair price for a share of Silicone Systems? O $463 $500 O $751 $834
Marty Market owns 200 shares of Light Bulb Utility. The company pays a $6 per share dividend and the share price is $ 156. How many shares would Marty need to sell to create a homemade dividend of $15 per share?
Nets & Flicks would like to take over Jeff & Bezos. Both companies are debt-free. For that, Nets & Flicks is offering to Jeff & Bezos cash and cash-like equivalents in the total amount of $73,000. Nets & Flicks currently has a total of 1,750 shares, and the market value of each share is $20. Jeff & Bezos, on the other hand, currently has a total of 2,500 shares, and the market value of each share is $28. The merger of these two companies would have a $5,000 incremental value if it is successful. The net present value of the merger from the point of view of Nets & Flicks equals. Multiple Choice $3,000 $4,000 $2,000 $5,000 $6,000
Toronto Corporation wants to raise $1,210,000 via a rights offering. The company currently has 220,000 shares of common stock outstanding that sells for $32 per share. The issue will allow current stockholders to purchase one additional share for 5 rights. a) What will be the ex-rights stock price, the value of a right, and the appropriate subscription price? b) If 2 rights are needed to purchase on additional share, how does the stockholders’ wealth change? c) Why do you think the company chose a rights issue rather than a general cash offer to raise new capital?
FarCry Industries, a maker of telecommunications equipment, has 2 million shares of common stock outstanding, 1 million shares of preferred stock outstanding, and 10,000 bonds. Suppose the common shares sell for $26 per share, the preferred shares sell for $14.00 per share, and the bonds sell for 97 percent of par.What weight should you use for preferred stock in the computation of FarCry’s WACC? (Round your answer to 2 decimal places.)
Teasler Inc. currently trades at $40 and has 9 million shares outstanding with Net Income of $12 Million. The Board decides to use a rights offering to raise new capital. Each shareholder will receive one right for each share. Laila Sims currently owns 4,000 shares of Teasler stock. Four rights plus $34 cash are needed to buy one new share. The ex-rights date is in 30 days. a. What is the value of a right? b-1. How many of the new shares could Laila buy if she exercised all her rights? b-2. How much cash would this require? c. How many new shares is Teasler issuing and what are the proceeds? d. If the price of Teasler shares price moves to $30 what is the value of the right ( Assume still rights-on)
Damron, Incorporated, has 205,000 shares of stock outstanding. Each share is worth $79, so the company’s market value of equity is $16,195,000. Suppose the firm issues 44,000 new shares at the following prices: $79, $73, and $67. What will be the ex-rights price and the effect of each of these alternative offering prices on the existing price per share?
OMG Inc. has 4 million shares of common stock outstanding, 3 million shares of preferred stock outstanding, and 5 thousand bonds. If the common shares sell for $17 per share, the preferred shares sell for $126 per share, and the bonds sell for 117 percent of par ($1,000), what weight should you use for preferred stock in the computation of OMG's WACC?
Please help me
You are the cfo of a company that has a market cap of 20B. The firm has 50 M shares outstanding, so the shares are trading at 400 per share. You need to raise 1B and have announced a rights issue. Each existing shareholder is sent one issuance right for every share they own. You need to decide how many rights you will require to purchase one share of new stock. You require 16 rights to purchase one share at a price of 320 per share, or 30 rights to purchase two shares at a price of 300 per share. How many shares will be issued with the first approach? How much money will be raised with the first approach? How many shares will be issued with the second approach? How much money will be raised with the second approach? What is the new stock price after issuing money with the second approach? What is the new stock price after issuing money with the first approach?

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