A bond has a face value of $10,000 and a conversion price of $46.04. The stock...
A bond has a face value of $10,000 and a conversion price of $46.04. The stock is currently trading at $35.02. What is the conversion ratio?
Homework Answers
Conversion ratio = 217.2 shares
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A bond has a face value of $10,000 and a conversion price of
$46.04. The stock...
Hilton Hotels Corp. has a convertible bond issue outstanding. Each bond, with a face value of...
Hilton Hotels Corp. has a convertible bond issue outstanding. Each bond, with a face value of $1,100, can be converted into common shares at a rate of 61.2984 shares of stock per $1,100 face value bond (the conversion rate), or $17.9450 per share. Hilton’s common stock is trading (on the NYSE) at $17.53 per share and the bonds are trading at $1,075. a. Calculate the conversion value of each bond. (Round your answer to 2 decimal places. (e.g., 32.16)) b....
You own a bond with a face value of $100,000 and a conversion ratio of 400....
You own a bond with a face value of $100,000 and a conversion ratio of 400. What is the conversion price? The conversion price for this bond is $1- (Round to the nearest cent.)
A $1000 par value convertible bond has a conversion price of $25. It is currently selling...
A $1000 par value convertible bond has a conversion price of $25. It is currently selling for $1,200, despite the fact that the bond's coupon rate and the market interest rate are equal. The common stock obtained upon conversion is selling for $27 per share. What is the convertible bond's conversion ratio? Select one: a. 37 b. 40 c. 48 d. 200
Company A issues a convertible bond with a 3.5% coupon rate and a $1,000 face value...
Company A issues a convertible bond with a 3.5% coupon rate and a $1,000 face value with a conversion ratio of 25. (Meaning it can be converted into 25 shares of stock) The company’s stock is currently selling for $26 per share A. At what price point does converting the bond become attractive to an investor? B. Will they convert as soon as the share price reaches this level? Explain?
Conversion (or stock) value What is the conversion (or stock) value of each of the following...
Conversion (or stock) value What is the conversion (or stock) value of each of the following convertible bonds? a. A $1,000-par-value bond that is convertible into 25 shares of common stock. The common stock is currently selling for $50.00 per share. b. A$1,000-par-value bond that is convertible into 12.5 shares of common stock. The common stock is currently selling for $42.00 per share. c. A$1,000-par-value bond that is convertible into 100 shares of common stock. The common stock is currently...
A convertible bond is selling for $967, matures in 15 years, has a $1,000 face value,...
A convertible bond is selling for $967, matures in 15 years, has a $1,000 face value, pays interest semiannually, and has a coupon rate of 8 percent. Similar non-convertible bonds are priced to yield 4.25 percent per six months. The conversion ratio is 20. The stock currently sells for $47.50 a share. Calculate the convertible bond's option value.
Maple Aircraft has issued a convertible bond at 4.75% interest due 2030. The market price of...
Maple Aircraft has issued a convertible bond at 4.75% interest due 2030. The market price of the convertible is 91% of face value (face value is $1,000), and the conversion ratio is 20. Assume that the value of the bond in the absence of a conversion feature is about 80% of face value. 1) What is the conversion price? 2) How much is the convertible holder paying for the option to buy one share of common stock?
The difference between the conversion price and the current stock price, divided by the current stock...
The difference between the conversion price and the current stock price, divided by the current stock price, is called the: Multiple Choice straight bond value. conversion value. conversion ratio. conversion price. conversion premium.
Conversion price Calculate the conversion price for the following convertible bond: A $700-par-value bond that is...
Conversion price Calculate the conversion price for the following convertible bond: A $700-par-value bond that is convertible into 25 shares of common stock. The conversion price is $_______ per share. (Round to the nearest cent.)
Consider a 30-year bond that has a face value of $10,000 and a coupon rate of...
Consider a 30-year bond that has a face value of $10,000 and a coupon rate of 9% with quarterly coupon payments. The yield to maturity (YTM) of the bond is 4%. a. What is the maximum price would you be willing to pay for this bond right now? b. What is the maximum price would you be willing to pay for this bond right after its 14thcoupon payment? c. What is the maximum price would you be willing to pay...
You own a bond with a face value of $100,000 and a conversion ratio of 400. What is the conversion price? The conversion price for this bond is $1- (Round to the nearest cent.)
Conversion (or stock) value What is the conversion (or stock) value of each of the following convertible bonds? a. A $1,000-par-value bond that is convertible into 25 shares of common stock. The common stock is currently selling for $50.00 per share. b. A$1,000-par-value bond that is convertible into 12.5 shares of common stock. The common stock is currently selling for $42.00 per share. c. A$1,000-par-value bond that is convertible into 100 shares of common stock. The common stock is currently...
Conversion price Calculate the conversion price for the following convertible bond: A $700-par-value bond that is convertible into 25 shares of common stock. The conversion price is $_______ per share. (Round to the nearest cent.)
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