XPEL Inc, has a target capital structure of 30% of preferred stock and the remaining equally weighed with common stock and debt. The relevant tax fate is 31%. The bonds were issued with 5% coupon rate with a pre-tax cost of debto rest. ammon stocks have a current market price of, 60$. The firm's earnings are expected to grow constant at 8% per year. The firm pays out 40% of its EPS as dividends. The firm is expecting an EPS of 16.5 $ next year. The common stock beta is 0.80 and the expected risk premium is 8%. Preferred dividends are at 1.2% with a market price of 90$ and principal value of 70$.

a. What is the WACC for XPEL Inc?

 b.Which is the least source of capital for XPEL Inc? Justify your answer with the sup numerical calculation?

Answer rating: 100% (QA)

To calculate the weighted average cost of capital WACC for XPEL Inc we need to determine the weights ... View the full answer