Equity shares equating the results of FCFF and FCFE methods

Artikel

The aim of the article is to present the method of establishing equity shares in weight average cost of capital (WACC), in which the value of loan capital results from the fixed assumptions accepted in the financial plan (for example a schedule of loan repayment) and own equity is evaluated by means of a discount method. The described method causes that, regardless of whether cash flows are calculated as FCFF or FCFE, the result of the company valuation will be identical.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: e-Finanse: Financial Internet Quarterly ; ISSN: 1734-039X ; Volume: 8 ; Year: 2012 ; Issue: 2 ; Pages: 34-43 ; Rzeszów: University of Information Technology and Management

Classification and Topics

• Classification: Wirtschaft ; Capital Budgeting; Fixed Investment and Inventory Studies; Capacity ; Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill ; Corporate Finance and Governance: Other
• Subject: weight average cost of capital ; discount rate ; free cash flow ; company valuation ; assessment of investment profitability

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Cegłowski, Bartlomiej ; Podgórski, Blażej
• Event: Veröffentlichung
• (who): University of Information Technology and Management
• (where): Rzeszów
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/66773
• Last update: 10.03.2025, 11:44 AM CET