Regions, Inc., has 6.1 million shares of common stock outstanding. The current s
ID: 2712630 • Letter: R
Question
Regions, Inc., has 6.1 million shares of common stock outstanding. The current share price is $61.10, and the book value per share is $4.1. Regions also has two bond issues outstanding. The first bond issue has a face value of $70.1 million, a 7.1 percent coupon, and sells for 97.5 percent of par. The second issue has a face value of $35.1 million, a 6.6 percent coupon, and sells for 96.5 percent of par. The first issue matures in 21 years, the second in 13 years.
(a)
What are the company’s capital structure weights on a book value basis?
Market value weight of equity: 0.19210.21520.28230.78480.80790.8306Market valueBond value
Market value weight of debt: 0.19210.21520.28230.78480.80790.8306Market valueBond value
(b)
What are the company’s capital structure weights on a market value basis?
Market value weight of equity: 0.19210.21520.28230.78480.80790.8306Market valueBond value
Market value weight of debt: 0.19210.21520.28230.78480.80790.8306Market valueBond value
(c)
Regions, Inc., has 6.1 million shares of common stock outstanding. The current share price is $61.10, and the book value per share is $4.1. Regions also has two bond issues outstanding. The first bond issue has a face value of $70.1 million, a 7.1 percent coupon, and sells for 97.5 percent of par. The second issue has a face value of $35.1 million, a 6.6 percent coupon, and sells for 96.5 percent of par. The first issue matures in 21 years, the second in 13 years.
Explanation / Answer
Regions, Inc., has 6.1 million shares of common stock outstanding. The current s