20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for September 2025 exams.
Get your discount code >>

Equity valuation by free cash flow to the equity

This topic has 1 reply, 2 voices, and was last updated 3 years ago by John Moffat.

Viewing 2 posts - 1 through 2 (of 2 total)

Author
Posts
September 16, 2021 at 12:06 pm #635825
ruchikapg
Participant
- Topics: 1
- Replies: 1
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 ) ?
September 16, 2021 at 5:26 pm #635841
John Moffat
Keymaster
- Topics: 57
- Replies: 54699
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).
Author
Posts

Viewing 2 posts - 1 through 2 (of 2 total)

You must be logged in to reply to this topic.