Weighted Average Cost Of Capital

Electrovaya Inc. (EFL.TO)

$0.92

0.00 (0.00%)
Share price $ 0.92
Beta 1.520
Diluted Shares Outstanding 139.89
Cost of Debt
Tax Rate 0.00
After-tax Cost of Debt 14.13%
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.960
Total Debt 19.11
Total Equity 128.70
Total Capital 147.82
Debt Weighting 12.93
Equity Weighting 87.07
Wacc

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.