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March June 2016 Q 3 Staple Group

This topic has 2 replies, 2 voices, and was last updated 5 years ago by John Moffat.

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September 1, 2020 at 8:26 am #582956
ajiljacob96
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Hey John
There are many threads regarding staple group already, but my doubt is that since Staple View is valued wit FCF to Equity why is it discounted with wacc and not ke like the textbook? is it just because ke is not given or are there any other reasons/assumptions
September 1, 2020 at 9:58 am #582979
ajiljacob96
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.
September 1, 2020 at 3:46 pm #583024
John Moffat
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It is because the question specifically says to use a cost of capital of 12% (couple with the fact that we have no information about the cost of debt).
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