WACC Weighted Average Cost of Capital | Explained with Example

In this lesson, you will understand what WACC (Weighted Average Cost of Capital) is, why it is important and how to calculate it using the cost of capital from various types of capital and financing sources. We show and explain the WACC formula and how it is calculated using the table.
We also explain what WACC is used for and how it works with the capital structure and the NPV (Net Present Capital). We give helpful tips on WACC and how it compares to IRR (Internal Rate of Return).
Capital Structure explained | How it affects EPS (Earnings Per Share & Profitability): • Capital Structure Expl...
IRR (Internal Rate of Return) Explained with Example: • IRR (Internal Rate of ...
Net Present Value (NPV) Calculation Example Using Excel: • Net Present Value (NPV...
Net Present Value (NPV) Calculation Example Using Table: • Net Present Value (NPV...
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Пікірлер: 92

  • @nangamsoceba6647
    @nangamsoceba66474 жыл бұрын

    Thank you so much this is crystal clear!

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    @marlontristen2095

    2 жыл бұрын

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    @declankaiden5177

    2 жыл бұрын

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    @marlontristen2095

    2 жыл бұрын

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    @marlontristen2095

    2 жыл бұрын

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  • @declankaiden5177

    @declankaiden5177

    2 жыл бұрын

    @Marlon Tristen No problem :D

  • @njabulomaphumulo94
    @njabulomaphumulo94 Жыл бұрын

    To think I have been battling with this chapter for the past 5 days and you have just simplified it in 17 minutes. Thank you.

  • @sarahserwar5909
    @sarahserwar59092 ай бұрын

    I spent hours trying to reason this WACC and get it to my brain and thanks to this video I finally get it .... Appreciate it

  • @mpheletau3278
    @mpheletau32783 ай бұрын

    This channel is quickly becoming my number 1 go to channel for simplifying finance concepts. Thanks a lot

  • @yanyanofficial8854
    @yanyanofficial88542 жыл бұрын

    Thank you for making it easier to understand. Simplicity is everything.

  • @africanchild5719
    @africanchild57193 жыл бұрын

    Beautiful voice, beautiful presentation... If I fail I won't blame you. Thank you

  • @yonatinochimodzi6179
    @yonatinochimodzi61798 ай бұрын

    Thank you very much. It's been a week of struggling with understanding WACC. This video has changed it all for me.😀

  • @maureenlouw-jantze6368
    @maureenlouw-jantze63684 жыл бұрын

    The video was awesome and very much helpful. Thank you!!

  • @mzwandilestishi3493
    @mzwandilestishi34933 жыл бұрын

    It had to be you who made it all clear....Thanks a lot

  • @tashingamungofa9562
    @tashingamungofa95622 жыл бұрын

    Life saver right here! You just made my life easier

  • @icebear8356
    @icebear83564 жыл бұрын

    Thank you for this!! Very helpful

  • @evelynastarkazhinga
    @evelynastarkazhinga3 ай бұрын

    Wow.. thank you very much. I never imagined this topic could be this simple.

  • @thatokometsi8008
    @thatokometsi80083 жыл бұрын

    I cant believe that I only found out about this channel this week. Everything just makes sense.

  • @sevillakassandracamille6654
    @sevillakassandracamille6654 Жыл бұрын

    Well-explained, Sir. Thank you so much!

  • @pieedmund94
    @pieedmund94 Жыл бұрын

    Well done! simple precise explanations.

  • @frederickfidel4533
    @frederickfidel45333 жыл бұрын

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    @danisabaloyi6083 жыл бұрын

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    @Lifestyle_Tik_Tok_compilation3 жыл бұрын

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  • @senditali16
    @senditali164 жыл бұрын

    Very very helpful🤘🏻thanks man.

  • @fedelicskaaria7289
    @fedelicskaaria72892 жыл бұрын

    Good job.Very clear and well presented

  • @lebogang.matlala8672
    @lebogang.matlala86722 жыл бұрын

    This was really helpful. thank you

  • @janwray
    @janwray7 ай бұрын

    Thank you so much for the great lesson.

  • @keojansen5340
    @keojansen5340 Жыл бұрын

    Thank you so much, you have helped me with my assignment, It is clear.

  • @elizabethmunetsi4663
    @elizabethmunetsi46639 ай бұрын

    Thank you so much for your tutorial!! It was so helpful!❤😊

  • @annielunabuccat-cabuyao8183
    @annielunabuccat-cabuyao81833 жыл бұрын

    Very helpful. Thankyou very much.

  • @zasendulomkhize3049
    @zasendulomkhize30498 ай бұрын

    Thanks so much for these videos. This channel is my go-to and have refered my colleagues as well🤜. Have greater chances of doing well in my MACF☺

  • @oyeleyeshadrach3169
    @oyeleyeshadrach31694 жыл бұрын

    Thanks..This really helped

  • @solsolive
    @solsolive2 жыл бұрын

    This was so helpful thank you so much!.

  • @taniaadonis8631
    @taniaadonis8631Ай бұрын

    i have definitely learned something new!

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    @godfrednuel810425 күн бұрын

    Wow you just made me smile Such a simple but meaningful presentation. God richly bless you ❤

  • @mzilikazi6216
    @mzilikazi62169 ай бұрын

    You are the best tutor👌

  • @user-ee2vz3uo9v
    @user-ee2vz3uo9v10 ай бұрын

    nice explained sir, tysm.....love from india

  • @primrosechivasa7453
    @primrosechivasa74532 жыл бұрын

    Awesome teaching

  • @blackpulsepictures2024
    @blackpulsepictures20244 жыл бұрын

    thankas it really helped!

  • @BuckeyeFitnessFirm
    @BuckeyeFitnessFirm2 жыл бұрын

    One of the best explanations I've watch! And I've watched a lot... do you tutor?

  • @tamsenish
    @tamsenish Жыл бұрын

    Great video!!

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    @jeanettemphatlo56622 жыл бұрын

    I found this channel a month ago and I can say it has helped a lot.. Thank you so much 😘😘

  • @amukelaniaffection3040
    @amukelaniaffection3040 Жыл бұрын

    Can you please make a video of . Learning Unit 5: Capital structure and Financial Leverage 2. Learning Unit 6: Degrees of Financial leverage, risk and break-even analysis 3. Learning Unit 7: Ddividend Policy

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    @karabomalatji2142 жыл бұрын

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    @sivenqonji98552 жыл бұрын

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    @venkadeshg94473 жыл бұрын

    Exactly presented what I want to know. Also made me to subscribe your channel

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    @kamogelotheo61103 жыл бұрын

    Thank u 🔥🔥🔥❤

  • @tatendamangwandi6734
    @tatendamangwandi67342 жыл бұрын

    thumbs up ..this is clear

  • @tamsenish
    @tamsenish Жыл бұрын

    Thank you!!

  • @manurapiyumal9327
    @manurapiyumal93273 жыл бұрын

    Thanks ! Helped me a lot.

  • @linahmbanjwa

    @linahmbanjwa

    8 ай бұрын

    ❤very helpful thanks

  • @bevonbwire6903
    @bevonbwire69032 жыл бұрын

    Thank you 🤗

  • @zinhledlamini591
    @zinhledlamini5918 ай бұрын

    Number one🎉

  • @mariamjallow2355
    @mariamjallow23553 жыл бұрын

    Thank you so much sir This really helped me understand

  • @jacinta3203
    @jacinta32034 жыл бұрын

    So helpful.

  • @Counttuts

    @Counttuts

    4 жыл бұрын

    Glad it helped.

  • @lordsick8527
    @lordsick85272 жыл бұрын

    Lifesaver❤🔥

  • @zeeigh_24
    @zeeigh_243 жыл бұрын

    thank you

  • @zandilek1551
    @zandilek15513 жыл бұрын

    I wish you would've added debentures to this. Awesome video tho!

  • @mihlalintloko7719
    @mihlalintloko77193 жыл бұрын

    WHICH OF THE LINKS S THE ONE THAT TEACHES HOW TO CALCULATE COST OF CAPITAL ?

  • @zeeigh_24
    @zeeigh_243 жыл бұрын

    by just watching this video I was able to solve problems

  • @simonayabrahams3353
    @simonayabrahams33533 жыл бұрын

    I am currently working on an assignment and I need to calculate the average cost of capital. Can you please assist me as im very confused?

  • @norminarif4321
    @norminarif43213 жыл бұрын

    Thank you sir 💐 such a great explaination 👍🏻 its help me a lot ✨

  • @ibekwe-ucheuba2480
    @ibekwe-ucheuba24802 жыл бұрын

    You the best

  • @mosesmanasseh7106
    @mosesmanasseh71066 ай бұрын

    Bravo❤

  • @jackthebeanstalkdelohio5146
    @jackthebeanstalkdelohio51462 жыл бұрын

    To find the cost of debt through wacc, will I have to calculate corporate's tax?

  • @oliverluwewa9413
    @oliverluwewa94133 жыл бұрын

    very clear , now where another example of calculating wacc where market cost of debt is not given

  • @fanashaa3130
    @fanashaa31302 жыл бұрын

    Thank u

  • @agneschinembeza1940
    @agneschinembeza19402 жыл бұрын

    Well explained, it now makes a lot of sense, I'm enlightened

  • @kibethillary2622
    @kibethillary26222 жыл бұрын

    Great

  • @kafuipraise6311
    @kafuipraise63112 жыл бұрын

    Thank you so much for this video ❤️

  • @mkbutinini3271
    @mkbutinini32713 жыл бұрын

    good

  • @mahlakophasha3299
    @mahlakophasha32992 жыл бұрын

    How does wacc link to debt to equity ratio?

  • @kutlwanosegole1182
    @kutlwanosegole1182 Жыл бұрын

    Hi can you please make another example when the book and market values are included. Thank you.

  • @gamingtechwithjeff6
    @gamingtechwithjeff63 жыл бұрын

    I really appreciate this☺️

  • @flaneurli.6077
    @flaneurli.60773 жыл бұрын

    hi can you help me pls. if they given previous value and expected future value for preferred stock, how to calculate market value of preferred stock?

  • @Counttuts

    @Counttuts

    3 жыл бұрын

    Good day, this one should help: kzread.info/dash/bejne/ZXWTkrWopcrgpM4.html

  • @najamkhanzada804
    @najamkhanzada8042 жыл бұрын

    In cost of capital measurement why should the cost of capital be calculated as a weighted average of the various types of funds that a firm generally used, not as the cost of the specific type of capital used during a given year?

  • @sujathakalidoss5578
    @sujathakalidoss5578 Жыл бұрын

    Which topic easily for distance students... I know only leverage sum ... Capital structure, weighted avg & divident policy

  • @sumiyaaktershanta8129
    @sumiyaaktershanta81292 жыл бұрын

    Where is the description I can't find it

  • @kachymwanza6953
    @kachymwanza69534 жыл бұрын

    Kindly show how the formula is applied

  • @sinai1687
    @sinai1687 Жыл бұрын

    Hello Sir. How would I calculate the weighted cost if there is a tax rate of 28% ?

  • @user-kq5st7wh7n

    @user-kq5st7wh7n

    10 ай бұрын

    You just replace the 35% with the 28% (or whichever tax rate is given to you)

  • @dimakatsomolebatsi2901
    @dimakatsomolebatsi29013 жыл бұрын

    Thank you soooo much you explained it in a very easy way, Much love!!!

  • @mahlakophasha3299
    @mahlakophasha32992 жыл бұрын

    Do you guy offer online classes

  • @Counttuts

    @Counttuts

    2 жыл бұрын

    Good day, yes we do. Email us at info@counttuts.com

  • @martinferreira7725
    @martinferreira7725 Жыл бұрын

    Hi - Please can you assist with explanation and example on the following question. Trendy Limited uses a combination of shares and debt in their capital structure. There are 2 million R1 ordinary shares in issue and the current market price is R2.50 per share. The latest dividend paid was 40 cents and a 9% average growth for the past six years was maintained. The company has 1 000 000 R2, 8% preference shares with a market price of R1.80 per share. Trendy Limited has a public traded debt with a face value of R2 million. The coupon rate of the debenture is 7% and the current yield to maturity of 10%. The debenture has 6 years to maturity They also have a bank overdraft of R600 000 due in 3 years’ time and interest is charged at 15% per annum. Additional information: • • Trendy Limited has a beta of 2.1, a risk-free rate of 7% and a return on the market of 16%. • • Company tax rate is 30%. Required: 4.1 Calculate the weighted average cost of capital, using the Gordon Growth Model to calculate the cost of equity. (22) 4.2 Calculate the cost of equity, using the Capital Asset Pricing Model. (3)

  • @ausakamanga9779
    @ausakamanga97793 жыл бұрын

    thank you