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Calculation of cost of equity

This topic has 3 replies, 2 voices, and was last updated 8 years ago by John Moffat.

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December 6, 2015 at 7:04 pm #288291
jahangir
Member
- Topics: 1
- Replies: 2
Dear sir…
In WACC how to calculate the cost of equity…. explain with calculation please….
Ordinary shares 200
Reserves 650
Please reply soon
December 7, 2015 at 7:24 am #288363
John Moffat
Keymaster
- Topics: 57
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You use the formula on the formula sheet.
You must watch the free lectures on cost of equity – I am sorry but I cannot possible type out the whole of the lectures here.
(Our lectures are a complete course for Paper F9 and cover everything needed to be able to pass the exam well.)
December 10, 2015 at 1:03 pm #290196
jahangir
Member
- Topics: 1
- Replies: 2
I am asking for cost of equity calculation on book value… tell me the formula only
December 10, 2015 at 2:35 pm #290228
John Moffat
Keymaster
- Topics: 57
- Replies: 54478
Do not be so rude!!
We never calculate cost of equity based on book value, and you certainly cannot calculate a cost of equity from the little bit of information you typed.
The only formula you need are the two on the formula sheet – the dividend valuation formula and the CAPM formula.
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