Questions tagged [wacc]

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ISLAMIC FINANCE WACC

I need to calculate WACC for copany operating in the coutry with islamic finance system. I used build-up method to calculate cost of equity. But still searching for cost of debt in the economy. Has ...
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143 views

DCF valuation and the constant WACC assumption

I have a question that has been on my mind ever since I learned about DCF. I was taught that for the DCF to be valid WACC should be constant. As a physicist by training this assumption is strange to ...
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Should cash-flows discounted at WACC be pre- or post-tax?

WACC in my mind is effectively a post-tax measure: $$\text{WACC} = \frac{E}{V} k_e+\frac{D}{V}k_d(1-t)$$ In this case should cash-flows, in particular loan cash-flows be adjusted for tax as well? ...
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How to handle negative WACC due to net income of a company being negative?

I am calculating the weighted Average capital cost of a company using the following formula : WACC However the company I am tying to find WACC has negative net income. As a result my WACC is negative. ...
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WACC: should the new issue of debt be averaged?

If a company already has debt in the amount of 3M with the cost of debt of 10% before taxes and common shares in the amount of 4M with the cost of equity of 8% and then decides to raise more money ...
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Negative Cost of Debt

I got the the interest expense from Microsoft, it is in negative: -2.73 billion (source: MSFT Annual Report). Does this mean Microsoft is receiving interest instead of paying it? If my cost of debt ...