Given the following information about a industrial client EBITDA $3 5 million Tax rate 38 Debt outstanding $2 5 million Cost of debt 10 Cost of common equity 14 Shares of stock outstanding 1,200,000 BV of the stock per share $12 The firms product market is considered stable, and the firm expects no growth, and all earnings are paid out as dividends Calculate the firms net income per share, assuming depreciation amortization costs of $600,000 per year

The Answer is in the image, click to view ...

Question: Given the following information about a industrial client: EBITDA = $3.5 million Tax rate = 38% Debt outstanding = $2.5 million Cost of debt =

Given the following information about a industrial client:

EBITDA = $3.5 million

Tax rate = 38%

Debt outstanding = $2.5 million

Cost of debt = 10%

Cost of common equity = 14%

Shares of stock outstanding = 1,200,000

BV of the stock per share = $12

The firms product market is considered stable, and the firm expects no growth, and all earnings are paid out as dividends. Calculate the firms net income per share, assuming depreciation & amortization costs of $600,000 per year.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Amy Nelson, CFA, has collected the following data about the firm: EBITDA = $3.5 million Tax rate = 38% Debt outstanding = $2.5 million Cost of debt = 10.5% Cost of common equity = 14% Shares of stock...

Julie Johnson has collected the following data about the firm: EBITDA = $ 3 . 5 million Tax rate = 3 8 % Debt outstanding = $ 2 . 5 million Cost of debt = 1 0 . 5 % Cost of common equity = 1 4 %...

Question: Julie Smith, an analyst with ABC Company, has collected the following data about the firm: EBITDA = $3.5 million Tax rate = 38% Debt outstanding = $2.5 million Cost of debt = 10.5% Cost of...

Julie Johnson has collected the following data about the firm: EBITDA = $3.5 million Tax rate = 38% Debt outstanding = $2.5 million Cost of debt = 10.5% Cost of common equity = 14% Shares of stock...

Johanna Barker, an analyst with Bob's Company, has collected the following data about the firm: EBITDA = $3.5 million Tax rate = 38% Debt outstanding = $2.5 million Cost of debt = 10.5% Cost of...

29. Julie Smith has collected the following data about the firm EBITDA - $3.5 million Tax rate = 38% Debt outstanding = $2.5 million Cost of debt -10.5% Cost of common equity = 14% Shares of stock...

Julie Smith, an analyst with ABC Company, has collected the following data about the firm: EBITDA = $3.5 million Tax rate = 35% Debt outstanding = $3 million Cost of debt = 10.5% Cost of common...

Question VI Corporate Financial Analysis (10 points) Julie Smith, an analyst with ABC Company, has collected the following data about the firm: EBITDA = $4.5 million Tax rate = 35% Debt outstanding =...

Please see attached samples and questions--they have to be correct please :) SAMPLE You are given the following information for Huntington Power Co. Assume the company's tax rate is 38 percent. Debt:...

Requirement 2 (30 points) You are given the following information for Twitter, Inc (TWTR). Assume the company's tax rate is 35%. Debt: 35,000 bonds outstanding with 8.5% coupon rate, $1,000 par...

Given six data bits 1011010, generate the hamming code word p 1 p 2 1 p 4 0 1 1 p 8 0 1 0?

Bob Co. is a vendor of fine upholstery and has a booming online storefront where they ship throughout the continental USA. Bob Co. is incorporated in Delaware and has its principal place of business...

6. Some passages containing for example can be correctly interpreted as arguments. True or False

Add "Viggo Mortenslet cast = new Map ( ) ;en " to the cast as the key, with value "Aragorn".