Term
WACC
Weighted Average Cost of Capital |
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Definition
The Cost of Capital is a combination of its payment to the different sources
Cost of Debt)(debt/total capital) + (Cost of Equity)(equity/Total Capital) |
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Term
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Definition
| Preferred shares usually get a fixed amount. Common shares discretionary. |
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Term
| Debt to Equity Ratio- Capital Structure |
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Definition
| Equity / Debt - Ratio of Debt to Equity |
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Term
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Definition
| Preferred stock, Common Stock, Retained Earnings |
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Term
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Definition
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Term
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Definition
| % of Earnings to Dividend |
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Term
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Definition
Expected return of a Companies stock E(Ra)equals the Risk Free (T-bills) plus the Equity Premium
E(Ra) = Rf + Beta (E(Rm) - Rf) |
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Term
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Definition
| Beta times the Equity - Expected return on all investments (Rm) minus the risk Free Return (Rf). |
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Definition
| Is the expected value of the company capital return by the market. (S&P 500, or others) Represents volatility in the market |
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Term
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Definition
| Cost of one project over another |
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Definition
| Current value of Capital at |
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Term
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Definition
| The longer the maturity date the higher the risk. |
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Term
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Definition
| The % us to determine the Present Value of a Cash Flow. Determine Viability of a project |
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