WACC (AM) Puns

I am following this link to calculate weighted average of capital cost : WACC

The company I am looking into has a negative income ; hence the WACC is coming as negative.

How do I handle such case with this formula.

WACC Calculation

EDIS and WACC is necessary for selling shares but what about buying shares. Do I have to click on "My purchase source" and do something there or can I just leave it now? (My purchased shares have arrived in meroshare and it's my first time).

Also, someone on facebook was saying I should call broker for Dp Holding(View mapping) purpose. What to say to broker? Can it be done online?

What screening tools can I use for ROIC vs. WACC screening, along with other conventional metrics such as P/E, EV/EBITDA, EBIT %?

Also, would you basically out industries that never deliver ROIC vs. WACC spreads? I.e., can't escape industry power curve...?
https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/the-strategy-and-corporate-finance-blog/could-roger-federer-be-as-successful-playing-badminton

I am reading “investment banking” by pearl and rosenbaum, and it says to use the target capital structure when doing a DCF. why would I not use the company’s current capital structure? Where does the company’s capital structure come into play here? When relevering the beta to come up with cost of equity?

Thanks for the help.

Good day Redditors,

My friend has approached me for assistance on calculating WACC. As I have not started studying for the L1 exams yet, my recent memory on the calculation of WACC is based on my undergrad studies. Hence, I have provided him with the following solutions. However, I'd like to check my understanding with you guys.

The question is in this image:

https://imgur.com/a/RaQ3F2T

My solutions:

 WACC Formula = (E/V * Ke) + (D/V) * Kd * (1 – Tax rate) 

Using the CAPM formula to solve for Ke

Ke = rf + B(mrp) = 3% + 1.3(6%) = 10.8%     

For Kd, would be the 6% coupon that Co. A issues.

Hence, WACC would be

(1/1.5 * 10.8%) + (0.5/1.5) * 6% * (1 - 0.17)
= 7.2% + 1.66%
= 8.86%

Would the above be correct?

However, I have some doubts on the above question:

1. Is the yield on long-term U.S. government bond equal to the risk-free rate?
2. What is the point of the yield on AAA corporate bond for this question? Is it just redundant information or is there a need for it?
3. Is there any use of inflation rate here? I understand it can be used to calculate real risk-free rate. However, my understanding is that it is used to discount real cash flows. In this question, there is no further information. Hence, would the inflation rate be needed in the above calculations?

Thanks for helping out!

you aren't allowed opinions, you do not exist in the household.

Tax amount from interest is also a "COST" from my understanding, but why is that excluded?

Like, ig I can’t talk that much because like, mine works for me ig? Like it describes me pretty accurately but that’s literally just coincidence. Like bruh

Is it just bank debt and notes payables or is it total liabilities? And how do I find the cost if the bonds are not listed?

I sat in December, and nobody I spoke to afterwards had a wacc question come up. Just got out of the exam today, again no wacc (20 marks of CAPM, including a 10 mark discussion... What?) And nobody else got one either. Are they being phased out completely or am I just unlucky?

Whenever i open an app on my chromebook, all the tabs i have open turn plain white .-. reloading does nothing (usually the tab freezes and when i reload it goes white)

I use instagram app a lot and it makes my google tabs freeze and i have to log out and back in.

Closing tabs didnt work (im not a boomer)

don't waste your life at least get a job as a firefighter or police officer because then you can help people while having the chance of death.

Can someone explain WACC to me using Apple as an example. I've tried browsing the internet for help, but am still struggling. Thanks!

must be wacc and active, we have good people but we need more. just pm for an invite.

Hi there, I am currently studying finance and have yet to go over how to estimate WACC values when creating a DCF. What are the ways you’ll find/estimate/create a WACC value?

Thanks so much :)

I kinda want to start using Charlie more often. Are there are good trinkets for Charlie that I should look out for?

https://preview.redd.it/8u4exmis4nl31.png?width=800&format=png&auto=webp&s=1818cce8d69d7cad190d85912000ffc8c9eba678

https://preview.redd.it/pmmgfnip4nl31.jpg?width=112&format=pjpg&auto=webp&s=bd1d47c16de1ae9be526f897bb93c0a8d0c5e8c0