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Capital Structure: Debt To Total Capitalization Equity To Total Capitalization

This document contains a WACC calculation with a capital structure of 29% debt and 71% equity. It lists a risk free rate of 2.5%, equity risk premium of 6%, levered beta of 1.19, and cost of equity of 9.62%. The cost of debt is 7.5% with an after-tax rate of 5.18%. This results in a WACC of 8.33%. It also contains a table comparing unlevered betas of comparable companies.

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Acxel Andres Altuve
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61 views

Capital Structure: Debt To Total Capitalization Equity To Total Capitalization

This document contains a WACC calculation with a capital structure of 29% debt and 71% equity. It lists a risk free rate of 2.5%, equity risk premium of 6%, levered beta of 1.19, and cost of equity of 9.62%. The cost of debt is 7.5% with an after-tax rate of 5.18%. This results in a WACC of 8.33%. It also contains a table comparing unlevered betas of comparable companies.

Uploaded by

Acxel Andres Altuve
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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© Corporate Finance Institute®. All rights reserved.

WACC Calculator

WACC Calculation
Capital Structure
Debt to Total Capitalization 29.00%
Equity to Total Capitalization 71.00%
Debt / Equity 40.85%

Cost of Equity
Risk Free Rate 2.50%
Equity Risk Premium 6.00%
Levered Beta 1.19
Cost of Equity 9.62%

Cost of Debt
Cost of Debt 7.50%
Tax Rate 31.00%
After Tax Cost of Debt 5.18%

WACC 8.33%

This file is for educational purposes only. E&OE

Corporate Finance Institute®


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Comparable Companies Unlevered Beta
Company Levered Beta Debt Equity Debt/Equity Tax Rate Unlevered Beta
Company A 1.23 520 1125 46.22% 31% 0.93
Company B 1.31 500 868 57.60% 30% 0.93
Company C 1.15 460 788 58.41% 29% 0.81
Company D 1.12 600 1125 53.33% 33% 0.83
Company E 1.25 450 900 50.00% 30% 0.93
Median 1.23 53.33% 0.93

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