- This topic has 1 reply, 2 voices, and was last updated 10 months ago by .
- You must be logged in to reply to this topic.
PQ Awards Nominations
Please help us to win one of the PQ Magazine awards and send in the voting form >>
You can nominate us in any or all of the following categories: Online College of the Year, Study Resource of the Year, Private Sector Lecturer of the Year, and Accountancy Personality of the Year.
Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>
using dividend VALAUTION model we get equity value of the company BUT if we use WACC instead of ke in dividends valuation model will the get total value of the company (Debt +equity)?
Discounting the free cash flows to equity (i.e. the dividends) at the cost of equity (which is what the dividend valuation model is going) gives the MV of equity.
Discounting the free cash flows to the firm (i.e. before interest) at the WACC gives the MV of the firm (equity plus debt).