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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Equity valuation by free cash flow to the equity
When we use free cash flow to the equity, we should discount by cost of equity (Ke). Is that Ke, Keg(Geared) or Keu (Ungeared ) ?
We always discount the free cash flow to equity by the actual cost of equity (which, if the company has gearing, if the geared cost of equity).