What is WACC - Weighted Average Cost of Capital

[@ScoutyBoyO]

in the formula, the equity portion (at 3.25 min), do you mean R instead of D? You have r being the required rate of return. Great video.

[@LearntoInvest]

You're absolutely correct. I apologize for that. It should have been r not d. I said required rate of return, but for some reason, I put d

[@waltersalvatore2055]

instablaster...

[@oliviat978]

My corporate finance lecturer for my master's didn't explain this even half as good as you did! thank you so much!

[@ngalawena]

This is better explained than my Harvard mba professors

[@Thomas-ow2bm]

how is that you can explain these things better than my old MBA profs? how is this possible? I mean seriously, a person drops a 100k on an mba and then finds better sources on youtube. wtf. edit: well done, keep it up, thank you

[@mehdiserghini6240]

i'm in the same case with the same feeling

[@MisterKelisi]

I agree

[@daredevil1189]

Yeah. Sad.

[@cafiveohsrockbandremix9254]

I love that you're able to explain WACC better in a 6:30 video than my Intermediate Finance textbook can in 40+ pages. Thank you!

[@jacintafeng6787]

Perfectly explained, probably the best WACC explanation u can find on KZbin

[@giantsquidy3491]

Thank you so much. I am in an MBA program and came from a very non-math undergraduate field. This video made everything clear. Profs and finance textbooks can be obscure and cryptic to those not of the math persuasion.

[@mahmuttumenbatur5632]

ı have been watching so many videos since yesterday to prepare myself for the exam, yours is the best one. simple, clear and to the point. well done and thank you

[@levibowles5917]

You already got a sub from me. I can't tell you how long I was looking for someone to break this down exactly like you did. Thank you!

[@mmiller7203]

I have read three sources on this subject when I should have just come watch your video.....thank you!

[@panagiotisanastasopoulos107]

Half a semester of finance course in ~7 minutes!! Great work!

[@delickkanyesigye9938]

Finally I've found someone who has made more sense of this especially on the Real application of WACC. Wow

[@printstudio9853]

woow..!!!...excellent piece of work bro...well done!!!

[@nicoleluo6692]

This is the best best WACC explanation i have never seen! 👍

[@olivercooper7556]

It’s incredible how such a complex perceived formula (or at least for me) can be explained so elegantly, what an incredible video!

[@brilliant1863]

I don't understand how your videos don't have more views. Great explanation as always!

[@LearntoInvest]

Thanks!

[@lukebarmakian3200]

I've been trying to learn DCF forever and this helped so much I know it's not actually about dcf but still thanks!

[@jadeling4025]

You are the best after I have been searching for this information online for 2 days and one night, seeing so many websites and google explanations. I especially like you telling me where can I find the average cost of debt.

[@sweettwiss1194]

My CFA length lecture is embarrassing compare to the info you give in one short video. Thank you so much!

[@owend8956]

The best tutorial for finance period.

[@ibrahimmosavi2168]

You explained way better than my finance professor. Thank you!

[@PPL_SFGCS]

Clear and conscience. Thanks for explaining the concept of WACC

[@LearntoInvest]

I like using WACC for discounted cash flow valuation. Do you use WACC or do you prefer a different method?

[@wazup3333]

How do you actually apply this with actual financial statements, finding the weight of debt and equity, and calculating the cost of debt when companies have many separate notes payable like convertible debentures that turn into equity..?

[@truenorth8996]

Than you so much. I struggled all evening trying to undesrtand wacc formula.. now its'clear

[@herryfrd2740]

best explanation of WACC i've ever heard

[@REDWAVE777-USA]

Way better than my professor. These professors complicate everything and spin it into some crazy concept.

[@marceljoshuakannampuzha522]

I have my finance exam in week and this video was absolutely perfect for my learning, thank you very much. Very helpful and broke down a complex topic into its simplest form.

[@yash3714]

Same, where u from

[@JosueLopez-jx1th]

Very clearly explained - Thanks!

[@_A_343]

Excellent example.

[@sitijamilahnordin4487]

you explained better than my MOCA lecturer thank you so much bless you!!!!!!!!!!!!

[@yizhang6117]

best ever explanation on WACC

[@giulianonigro774]

Thank you for the video! It's really straightforward and useful to understand the meaning behind the wacc

[@23longbong]

wow easier to understand than my 2-hour lecture, thank youu

[@bartoszjozefowski7247]

Great, short and pro explained!

[@johnzarznia6814]

This is a great video! I use WACC sometimes but I often just default to PE because its easier to use. But i wan to get my skills up enough to confidently use WACC.

[@aprilbrown9994]

I LOVE YOU!!! Thanks a million, it’s a damn shame my professor couldn’t break it down like this!!!!

[@Springdaysbetter]

Your explanations were so clear and perfectly understandable Thank you so much😊

[@glee1669]

THANK YOU for this! I understand WACC in general and how to compute, but I was missing a clear reasoning of how it was applied back to whether a company should pursue a project of an expected return rate of x%. 🙏!

[@donfrancis1246]

This video is so useful, I cannot thank you enough.

[@SurajSharma-kl9vl]

you explained it way better than my acct prof did , thank you

[@csjames69]

Easy to understand while doing my MBA studies. Thanks.

[@LearntoInvest]

I'm glad you liked it 😁

[@itsmohdiii3689]

amazing video very educational helped me refresh my memory before an interview as a finance student thank you ... guys this is a no bs video amazingly helpfull you sir get my like and subscription

[@Beancounter2014]

Thanks for the video. It breaks WACC down in a way that is very understandable.

[@jiveon007]

Brilliantly explained. Thank you.

[@knithindas]

Hey guys awesome work. Great work. Minimum visual effects made it better. Thanks

[@Gar136]

Thank you for helping me prepare for my quiz :)

[@DrSam86]

Thank u man..u help me greatly with mba much more than the horrible univ. books.

[@connertaherian5166]

Your videos are very well crafted, thanks!

[@kawardt6784]

If my teacher could explain like you do. My teacher doesnt consider people that doesnt know a thing about finance. First time learning finance, new subject in my first sem, he just keeps talking and talking and I dont even know the terms he's using.

[@nazimrahman]

wonderfully explained

[@kevorod]

Love this video format!

[@patgreaney4730]

Please explain how to find the equity value in the WACC calculation. Is it the current market value of all stock in which case it is market capitalization ($/shr x no. of shrs), or is it the stockholders equity which can be found from the balance sheet? These are two very different numbers.

[@connorgioiafigliu]

Really simple explanation, thank you!

[@jakobherold26]

Perfectly explained, thank you so much! Insane video!

[@cassiusbraganza4658]

Wow, Amazing video bro!

[@emmy8133]

Clear explanation! Thanks for sharing.

[@willfindjr]

Great video.. example used was very relevant and easy to understand. please keep the videos coming :-)

[@vutony4282]

Very easy to understand. Thanks.

[@ChiChi-sw5iu]

Great explanation! Thank you for this!

[@ozandogacerdem8450]

This is a great video I loved it. Thank you for sharing it. I learned a lot of information.

[@pravinmakwana3039]

in the formula I make the debt portion of the equation 0.9% not 3% as shown. I think video is excellent though.

[@sandrajin915]

Super helpful! Thank you so much for this video!

[@AlexOus]

Thanks for your efforts! Great content!

[@monicaruiz4774]

Just want to make sure I understood this correctly, the 4%, and 10% would come from the footnotes, correct? If they do not, how do we calculate these numbers? Does the company provide the calculated future value? If not, wouldn't this value be too speculative, and therefore not useful?

[@gracefultowels3283]

Do we even need the Terminal value or just stick to adjusted present value to consider the margin of safety?

[@kojo6402]

thanks so much. please teach more corporate finance related subjects NPV, APV, IRR, WACC, CAPM etc

[@LearntoInvest]

Good idea! I'll let you know when I do some more

[@kaushiks87]

Great video. I just found an awesome channel for learning Finance Models!

[@brayaran7370]

Thank you for explaining this. This video is a JEWEL!

[@markmendis5951]

Hey, Could you please do a video on the how to find intrinsic value of a company per share basis.

[@LearntoInvest]

I got you covered kzbin.info/www/bejne/nJXClqCCgd99pM0 👍🙂

[@pingislife2653]

J, thank you for this lesson! It was very useful in better understanding your other video on how to value a stock using DCF.

[@shubramsubramanyam542]

great video! can i know what software was used to create this video please?

[@ludiogot143]

Thank you for making it simple

[@jyotibarman1247]

do we have to take the market cap or the shareholders fund in place of market value of the equity?

[@Ryan-wf7sh]

Great video jimmy, but one important question, where does a mere mortal find the information to input into the formula!?

[@radhakrishnavempati1391]

Thanks for the video. It sir really useful. But, I have a question, the WACC percentage value is a percentage of the companies market cap right? Hope to receive a reply soon! Thanks!

[@peterheine6240]

Hello I have a question. Why is the income tax rate taken into account when calculating the WACC?

[@jackthebeanstalkdelohio5146]

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

[@properoldschool]

Thanks so much, you made this easier to understand.

[@alishlalani2751]

Business finance final today, this really helped! Also you have a really good voice!

[@yash3714]

how did it go?

[@alishlalani2751]

I aced it!!

[@yash3714]

Congrats!! Can you help me with my business finance assessment i have?

[@SkaleFreaks]

Excellent video! thanks for sharing

[@barberuddin4928]

Perfectly explained!

[@raishutalks8216]

Thank you Jimmy

[@willrogers7308]

brilliant video, thank you so much!

[@scatchah8810]

I know its a very basic question... but why does the debt has cost? (and equity as well?) Where does this cost come from???

[@its_me_human6448]

Super valuable video, you are amazing and life changer.

[@Springdaysbetter]

I have a question? I am trying to get YTM by having face value and current value and time to maturity,what is exactly the formula to find it? I can’t get the right answer

[@abuh9400]

Nice method on explaining, like it

[@SkylerJames]

Now that we seem to be headed into an inflationary environment, I put more WACC focus on my company analyses. Companies with lower costs of capital should be able to weather high inflation better due to their financial stability and theoretically more stable balance sheet.

[@surajrambhia1742]

Is there a website or online calculator that can do all of these basic calculations and automatically say if a stock is under or overvalued based on such and such model?

[@Payalmittal04]

Thank you so much for this video 😊

[@toneraynger]

Hi Jimmy, Great video but could you clearly explain where the 7.9% that fell out of the sky came from... it was all going so well till then... thanks and good job

[@tannguyenphucgia]

i'm so confused about the tax part. Can someone please explain it to me? Many thanks.

[@jagulba]

Awesome content man... learning so much from you Btw what are your favorite models to evaluate a fair price of businesses Do you have a video explaining which model should be used for what kind of business?

[@benhallo1553]

You lost me at 4:11. where does the top line you wrote of the equation come from and what happened to the rest of the equation to the left? how did you get 7.9%?

[@bamschilders]

Fill in the formula so you get 0.3*0.04*0.75+0+0.7*0.1=0.079. So the percentages he first divided by 100. and at the end you multiple by 100. I hope it was helpful

[@deflamrek]

@@bamschilders great explanation

[@tubarao1143]

Great video! Should I use diluted average shares or diluted average shares? What is the difference of using one or another?

[@LearntoInvest]

I prefer to use diluted shares because it's a bit more conservative.

[@jahorasvictornaibaho7467]

Great explanatuon... I understood about the using WACC

[@aasimnagarwalaqq1980]

How to calculate for bank and finiance companies as debt portion is always high. Please guide.

[@Intothemarket101]

Thank you so much for sharing this useful data! Greatly appreciated.

[@SanderCords1]

This is a very clear video! Thnx!

[@LearntoInvest]

Thanks, I'm glad you like it!

[@alexandervoronin5323]

Why the profit created by the company on top of equity and debt is not considered as 3rd part in the equation? For example our company generated enough money to repay it's debt and to pay considerable dividends to its shareholders, but still has considerable amount of cash left which basically belongs to the company itself, so the company now can invest into less profitable projects, just expecting to get slightly more than risk free rate, only to beat inflation, why not?

[@mominamus8762]

Great explaination👌👌 Can you explain what do you meant by discounting cash flows???