question archive JJ firm issues preferred dividends at an annual rate of $3
JJ firm issues preferred dividends at an annual rate of $3
Subject:FinancePrice: Bought3
JJ firm issues preferred dividends at an annual rate of $3.06. Its
current preferred stock price is $22.65. Assume that the equity beta for JJ is 0.93. The Yield on 10-year treasuries is 2.74%, and that the market risk premium for the year is 7%. The company's EPS expected growth is 3%. For this year, the dividends for JJ firm are the same for common and preferred stock; additionally the price for common stock is $28. What is the preferred cost of equity for JJ Firm?
