Financing Example - EPS Impact of
Alternatives
At the beginning of year 1, the firm needs to raise $10M of
capital to expand.
Assume the following data:
and volatility is
35%
(Note
this is not necessarily the rate of
EPS
growth)
There are three financing approaches
Required:
For each of the first 5 years, compute projected EPS under each
financing approach.
Each year, you will need to compute the following:
Financing Example - EPS Impact of Alternatives At the beginning of year 1, the firm needs to raise $10M of capital to ex
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