Weighted Average Cost Of Capital

BiondVax Pharmaceuticals Ltd. (BVXV)


-0.02 (-1.15%)
Share price $ 1.72
Beta 2.462
Diluted Shares Outstanding 10.75
Cost of Debt
Tax Rate 0.00
After-tax Cost of Debt 15.53%
Risk-Free Rate
Market Risk Premium
Cost of Equity 15.313
Total Debt 69.74
Total Equity 18.49
Total Capital 88.22
Debt Weighting 79.04
Equity Weighting 20.96

There are a number of methods that can be used to determine discount rates. A good approach – and the one we’ll use in this tutorial – is to use the weighted average cost of capital (WACC) – a blend of the cost of equity and after-tax cost of debt. A company has two primary sources of financing – debt and equity – and, in simple terms, WACC is the average cost of raising that money. WACC is calculated by multiplying the cost of each capital source (debt and equity) by its relevant weight and then adding the products together to determine the WACC value.