Featured Announcements. The parents of Travis William Tennessen and Morgan Lee Holz are proud to announce the engagement of their children. Morgan, daughter of Bill and Nancy Holz, is a 2015 graduate from the University of Wisconsin - Oshkosh where she earned...
Weighted Average Cost of Capital or WACC. The WACC calculation is a calculation of a companyâs cost of capital in which each category of capital is equally weighted. All capital sources such as common stock, preferred stock, bonds and all other long-term debt are included in this calculation.urrently, Chevronâs has a Cost of Equity or R Equity of 6.72% so investors should expect to get a return of 6.72% per-year average over the long term on their investment to compensate for the risk they undertake by investing in this company. (Please note that this is the CAPM approach to finding the cost of equity.
Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is proportionately weighted.All sources of capital, including common stock, preferred stock, bonds and any other long-term debt, are included in a WACC calculation.A firmâs WACC increases as the beta and rate of return on equity increase, as an increase in WACC denotes a decrease in valuation and an increase in risk.To calculate WACC, multiply the cost of each capital component by its proportional weight and take the sum of the results.REAKING DOWN 'Weighted Average Cost Of Capital-WACC'. In a broad sense, a company finances its assets either through debt or with equity. WACC is the average of the costs of these types of financing, each of which is weighted by its proportionate use in a given situation.