Estee Lauder Companies' stock was sold by a variety of institutional investors in the last quarter, including Fred Alger Management Inc., American Century Companies Inc., Brown Advisory Inc., Renaissance Technologies LLC, Credit Agricole S A, Robeco Institutional Asset Management B.V., TIAA CREF Investment Management LLC and Montag & Caldwell LLC.
DEFINITION of 'Cost Of Capital'. The cost of funds used for financing a business. Cost of capital depends on the mode of financing used â it refers to the cost of equity if the business is financed solely through equity, or to the cost of debt if it is financed solely through debt.ince the cost of capital represents a hurdle rate that a company must overcome before it can generate value, it is extensively used in the capital budgeting process to determine whether the company should proceed with a project.
The firmâs overall cost of capital is based on the weighted average of these costs. For example, consider an enterprise with a capital structure consisting of 70% equity and 30% debt; its cost of equity is 10% and after-tax cost of debt is 7%.Therefore, its WACC would be (0.7 x 10%) + (0.3 x 7%) = 9.1%.EFINITION of 'Cost Of Capital'. The cost of funds used for financing a business. Cost of capital depends on the mode of financing used â it refers to the cost of equity if the business is financed solely through equity, or to the cost of debt if it is financed solely through debt.