WACC Pointer Corporation has 20,000 bonds outstanding with a 7% annual coupon rate, 12 years to maturity, a $1,000 face value, and a $1,100 market price. Assume semiannual coupon payments. The company’s 200,000 shares of preferred stock pay a $1 annual dividend, and sell for $20 per share. The company’s 1,00,000 shares of common stock sell for $35 per share and have a beta of 0.92. The risk free rate is 3%, and the market return is 15%. Assuming a 21% tax rate, what is the company’s WACC?
