Suppose that a high tech firm raises $150 million in an IPO. The firm receives $27 per share, and the stock sold to the public at $30 per share. The firm's legal fees, SEC registration fees, and other administrative costs are $410,000. The firm's stock price increases 13.5 percent on the first day. What is the firm's total cost of issuing the securities? $33,635,000 $20,250,000 $35,660,000 $15,000,000
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- Suppose a Sam's company in CA, completes an $95 million IPO priced to the public at $50 per share. The firm receives $47 per share, and the out-of-pocket expenses are $480,000. The stock’s closing price at the end of the first day is $59. What is the total cost to the firm of issuing the securities? $_______Suppose that a biotech firm in Pittsburgh raised $122 million in an IPO. The firm received $23 per share, and the stock sold to the public for $25 per share. The firm's legal fees, SEC registration fees, and other out-of-pocket costs were $475,000. The firm's stock price increased 17.5 percent on the first day. What was the total cost to the firm of issuing the securities?Management plans a $120 million IPO in which the offering price to the public will be $50 per share. The company will receive $47.50 per share. The firm’s legal fees, SEC registration fees, and other out-of-pocket costs will total $400,000. If the stock price increases 14 percent on the first day of trading, what will be the total cost of issuing the securities? Total cost $________
- Consider a firm with an EBITDA of $14,400,000 and an EBIT of $11,200,000. The firm finances its assets with $51,400,000 debt (costing 7.2 percent) and 10,700,000 shares of stock selling at $6.00 per share. The firm is considering increasing its debt by $25,800,000, using the proceeds to buy back shares of stock. The firm’s tax rate is 21 percent. The change in capital structure will have no effect on the operations of the firm. Thus, EBIT will remain at $11,200,000. Calculate the EPS before and after the change in capital structure and indicate changes in EPS. (Round your answers to 3 decimal places.) EPS before $ EPS after $ Changes in EPS $Consider a firm with an EBITDA of $14,400,000 and an EBIT of $11,200,000. The firm finances its assets with $51,400,000 debt (costing 7.2 percent) and 10,700,000 shares of stock selling at $6.00 per share. The firm is considering increasing its debt by $25,800,000, using the proceeds to buy back shares of stock. The firm’s tax rate is 21 percent. The change in capital structure will have no effect on the operations of the firm. Thus, EBIT will remain at $11,200,000.Calculate the EPS before and after the change in capital structure and indicate changes in EPS. (Round your answers to 3 decimal places.) EPS before = $0.550 EPS after = $__.___ change in Eps = $__.___Crane Biotech management plans a $110 million IPO in which the offering price to the public will be $80 per share. The company will receive $47.50 per share. The firm's legal fees, SEC registration fees, and other out- of-pocket costs will total $500,000. If the stock price increases 14 percent on the first day of trading, what will be the total cost of issuing the securities? Total cost $ 62155000 %24
- Stump, Inc. issues a $66 million IPO priced at $17 per share, and the offering price to the public is $22 per share. The firm's legal fees, SEC registration fees, and other administrative costs are $350,000. The firm's stock price increases 15 percent on the first day. What is the underpricing spread? $51 million O $15 million O $66 million O $30 millionConsider a firm with an EBITDA of $900,000 and an EBIT of $800,000. The firm finances its assets with $4,610,000 debt (costing 7.1 percent, all of which is tax deductible) and 211,000 shares of stock selling at $15 per share. To reduce risk associated with this financial leverage, the firm is considering reducing its debt by $2,610,000 by selling additional shares of stock. The firm’s tax rate is 21 percent. The change in capital structure will have no effect on the operations of the firm. Thus, EBIT will remain at $800,000. Calculate the EPS before and after the change in capital structure and indicate changes in EPS. Note: Do not round intermediate calculations. Round your answers to 2 decimal places.Sheridan Biotech management plans a $120 million IPO in which the offering price to the public will be $60 per share. The company will receive $47.50 per share. The firm’s legal fees, SEC registration fees, and other out-of-pocket costs will total $600,000. If the stock price increases 14 percent on the first day of trading, what will be the total cost of issuing the securities?
- Consider a firm with an EBITDA of $900,000 and an EBIT of $800,000. The firm finances its assets with $4,610,000 debt (costing 7.1 percent, all of which is tax deductible) and 211,000 shares of stock selling at $15 per share. To reduce risk associated with this financial leverage, the firm is considering reducing its debt by $2,610,000 by selling additional shares of stock. The firm’s tax rate is 21 percent. The change in capital structure will have no effect on the operations of the firm. Thus, EBIT will remain at $800,000.Consider a firm with an EBITDA of $900,000 and an EBIT of $800,000. The firm finances its assets with $4,610,000 debt (costing 7.1 percent, all of which is tax deductible) and 211,000 shares of stock selling at $15 per share. To reduce risk associated with this financial leverage, the firm is considering reducing its debt by $2,610,000 by selling additional shares of stock. The firm’s tax rate is 21 percent. The change in capital structure will have no effect on the operations of the firm. Thus, EBIT will remain at $800,000. Calculate the EPS before and after the change in capital structure and indicate changes in EPS.Check my work Consider a firm with an EBIT of $866,000. The firm finances its assets with $2,660,000 debt (costing 8 percent and is all tax deductible) and 560,000 shares of stock selling at $5.00 per share. To reduce the firm's risk associated with this financial leverage, the firm is considering reducing its debt by $1,000,000 by selling an additional 360,000 shares of stock. The firm's tax rate is 21 percent. The change in capital structure will have no effect on the operations of the firm. Thus, EBIT will remain at $866,000. Calculate the change in the firm's EPS from this change in capital structure. (Do not round intermediate calculations and round your final answers to 2 decimal places.) EPS before EPS after Difference