Average cost of capital

Average cost of capital

A firm's required payout to bondholders and stockholders expressed as a percentage of capital contributed to the firm. Average cost of capital is computed by dividing the total required cost of capital by the total amount of contributed capital.

Average Cost of Capital

The total amount that a company must pay in dividends on preferred stock and in coupons on bonds, expressed as a percentage of the total amount raised through the issue of stock and bonds. This shows what a company must spend in order to raise the capital it needs to maintain or expand operations.
References in periodicals archive ?
Unsurprisingly, Bloomberg's estimate (uses actual cost of debt and estimated cost of equity) of PPC's weighted average cost of capital (WACC) is 8 percent.
Any offer would have to meet our objectives of earnings per share accretion, free cash flow generation and a return on invested capital exceeding International Paper's weighted average cost of capital, while enabling International Paper to remain committed to a strong balance sheet over the long term.
4%, in-line with our long-term ROE target of 300 basis points over our weighted average cost of capital.
The factor traditionally used is the Weighted Average Cost of Capital (WACC).
Longer-than-normal cash conversion cycle resulting in a high financial leverage, low return on invested capital versus weighted average cost of capital, no dividend distribution expected soon," the report continued.
4 per cent) exceeding the industry's average cost of capital (7.
That Market based rate of return on Wighted Average Cost of Capital (WACC) on the value of net fixed assets is proposed.
Summary: The weighted average cost of capital (WACC) was increased from 13.
4 percent, exceeding the industry's average cost of capital of 7.
Exhibit 3 presents the capital structure and weighted average cost of capital (WACC) for the hypothetical company, where the left side of the exhibit is unadjusted for operating leases and the right side shows the effect of all leases characterized as capital leases.
We believe that Eldorado is positioned for continued growth with a portfolio of premiere regional gaming assets, a solid balance sheet and an attractive weighted average cost of capital.
The acquisition is expected to deliver a return on invested capital above Wolters Kluwer's after tax weighted average cost of capital in three to five years and is expected to have positive but immaterial impact on Wolters Kluwer adjusted earnings in the first full year.