公司理财(双语)8costofcapital

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1、Chapter8PrinciplesofCorporateFinanceNinthEditionCostofCapital15-2TopicsCoveredKnowhowtodetermineafirm’scostofequitycapitalKnowhowtodetermineafirm’scostofdebtKnowhowtodetermineafirm’soverallcostofcapitalUnderstandpitfallsofoverallcostofcapitalandhowtomanagethem15-3ChapterOu

2、tlineTheCostofCapitalTheCostofEquityTheCostsofDebtandPreferredStockTheWeightedAverageCostofCapital15-4WhyCostofCapitalIsImportantWeknowthatthereturnearnedonassetsdependsontheriskofthoseassetsThereturntoaninvestoristhesameasthecosttothecompanyOurcostofcapitalprovidesuswitha

3、nindicationofhowthemarketviewstheriskofourassetsKnowingourcostofcapitalcanalsohelpusdetermineourrequiredreturnforcapitalbudgetingprojects15-5RequiredReturnTherequiredreturnisthesameastheappropriatediscountrateandisbasedontheriskofthecashflowsWeneedtoknowtherequiredreturnfo

4、raninvestmentbeforewecancomputetheNPVandmakeadecisionaboutwhetherornottotaketheinvestmentWeneedtoearnatleasttherequiredreturntocompensateourinvestorsforthefinancingtheyhaveprovided15-6CostofEquityThecostofequityisthereturnrequiredbyequityinvestorsgiventheriskofthecashflows

5、fromthefirmBusinessriskFinancialriskTherearetwomajormethodsfordeterminingthecostofequityDividendgrowthmodelSMLorCAPMInvestinprojectTheCostofEquityCapitalFirmwithexcesscashShareholder’sTerminalValuePaycashdividendShareholderinvestsinfinancialassetBecausestockholderscanrein

6、vestthedividendinriskyfinancialassets,theexpectedreturnonacapital-budgetingprojectshouldbeatleastasgreatastheexpectedreturnonafinancialassetofcomparablerisk.Afirmwithexcesscashcaneitherpayadividendormakeacapitalinvestment15-8TheDividendGrowthModelApproachStartwiththedivide

7、ndgrowthmodelformulaandrearrangetosolveforRE15-9DividendGrowthModelExampleSupposethatyourcompanyisexpectedtopayadividendof$1.50persharenextyear.Therehasbeenasteadygrowthindividendsof5.1%peryearandthemarketexpectsthattocontinue.Thecurrentpriceis$25.Whatisthecostofequity?15-

8、10Example:EstimatingtheDividendGrowthRateOnemethodforestimatingthegrowthrateistousethehis