財(cái)務(wù)管理：理論與實(shí)踐21show-展示頁
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【正文】 right 169。 20xx Harcourt, Inc. All rights reserved. ?P0 = $20. ?kd of 20year annual payment bond without warrants = 12%. ?50 warrants with an exercise price of $25 each are attached to bond. ?Each warrant’s value is estimated to be $3. Given the following facts, what coupon rate must be set on a bond with warrants if the total package is to sell for $1,000? 21 9 Copyright 169。 20xx Harcourt, Inc. All rights reserved. ?However, if the issuer is risky, the floating rate preferred stock may have too much price instability for the liquid asset portfolios of many corporate investors. 21 7 Copyright 169。 20xx Harcourt, Inc. All rights reserved. ?Advantages ?Dividend obligation not contractual ?Avoids dilution of mon stock ?Avoids large repayment of principal ?Disadvantages ?Preferred dividends not tax deductible, so typically costs more than debt ?Increases financial leverage, and hence the firm’s cost of mon equity What are the advantages and disadvan tages of preferred stock financing? 21 5 Copyright 169。 20xx Harcourt, Inc. All rights reserved. ?Preferred dividends are specified by contract, but they may be omitted without placing the firm in default. ?Most preferred stocks prohibit the firm from paying mon dividends when the preferred is in arrears. ?Usually cumulative up to a limit. How does preferred stock differ from mon stock and debt? (More...) 21 3 Copyright 169。21 1 Copyright 169。 20xx Harcourt, Inc. All rights reserved. ?Types of hybrid securities ?Preferred stock ?Warrants ?Convertibles ?Features and risk ?Cost of capital to issuers CHAPTER 21 Hybrid Financing: Preferred Stock, Warrants, and Convertibles 21 2 Copyright 169。 20xx Harcourt, Inc. All rights reserved. ?Some preferred stock is perpetual, but most new issues have sinking fund or call provisions which limit maturities. ?Preferred stock has no voting rights, but may require panies to place preferred stockholders on the board (sometimes a majority) if the dividend is passed. ?Is preferred stock closer to debt or mon stock? What is its risk to investors? To issuers? 21 4 Copyright 169。 20xx Harcourt, Inc. All rights reserved. ?Dividends are indexed to the rate on treasury securities instead of being fixed. ?Excellent ST corporate investment: ?Only 30% of dividends are taxable to corporations. ?The floating rate generally keeps issue trading near par. What is floating rate preferred? 21 6 Copyright 169。 20xx Harcourt, Inc. All rights reserved. ?A warrant is a longterm call option. ?A convertible consists of a fixed rate bond (or preferred stock)plus a longterm call option. How can a knowledge of call options help one understand warrants and convertibles? 21 8 Copyright 169。 20xx Harcourt, Inc. All rights reserved. Step 1: Calculate VBond VPackage = VBond + VWarrants = $1,000. VWarrants = 50($3) = $150. VBond + $150 = $1,000 VBond = $850. 21 10 Copyright 169。 20xx Harcourt, Inc. All rights reserved. ?At issue, the package was actually worth VPackage = $850 + 50($5) = $1,100, which
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