Ignore the information given earlier related to Contact Energy. Assume a
cost of debt of 2% and an equity beta of one for Contact Energy. Assume
that the market risk premium is 4.5% and the risk-free rate is 1.1% (as
of August 31, 2021). Assume that the closing price is 8.15 NZD/share,
number of shares outstanding is 776 million, net debt is NZD 706
million, and the marginal corporate tax rate is 28%. (Provide your
answer as x.xx. For
cost of debt of 2% and an equity beta of one for Contact Energy. Assume
that the market risk premium is 4.5% and the risk-free rate is 1.1% (as
of August 31, 2021). Assume that the closing price is 8.15 NZD/share,
number of shares outstanding is 776 million, net debt is NZD 706
million, and the marginal corporate tax rate is 28%. (Provide your
answer as x.xx. For
• The debt to capital ratio (net debt / (net debt +
market cap) is example, if the net debt is 500 and total capital is
1000, fill in 0.50)
market cap) is example, if the net debt is 500 and total capital is
1000, fill in 0.50)
• The cost of equity is % (Provide your answer as
x.xx. If the cost of equity is 5.05%, fill in 5.05).
x.xx. If the cost of equity is 5.05%, fill in 5.05).
• The after-tax
WACC is % (Provide your answer as x.xx. If the WACC is 5.05%, fill in
5.05).
WACC is % (Provide your answer as x.xx. If the WACC is 5.05%, fill in
5.05).
