What is WACC?

WACC (‘Weighted Average Cost of Capital’).
This Weighted Average reflects the blended average return for all providers of capital to the company. We call this blended average return the Weighted Average Cost of Capital.
Weighted Average Cost of Capital (WACC) Components:
✅Debt / (Debt + Equity) - the value of Debt (typically Book Value) relative to the total value of Debt + Equity.
✅Cost of Debt (Kd) - the current blended return expected by Lenders to the Company. Typically calculated as the weighted average Yield to Maturity for all components of the Company’s Debt. Note that we look at the Cost of Debt on an after-tax basis because Interest is tax-deductible, which lowers the true Cost of Debt.
✅Debt / (Debt + Equity) - the value of Equity (always Market Value) relative to the total value of Debt + Equity.
✅Cost of Equity (Ke) - the level of Return expected by Investors in the Business which is calculated using the Capital Asset Pricing Model (or ‘CAPM’) formula.
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[@123alexer]

How long would it take to learn all the fundamentals needed for a commercial banking credit analyst role? for ppl who don’t want the IB grind

[@PrajjwalDeb]

Just learn the logic behind all the calculations, in my experience you don't really NEED to know the formulas by heart (cuz we live in digital age and you can have an Excel ready to just input the numbers and get the answer) But what you need to learn is how it applies to the deals and what it means

[@123alexer]

@@PrajjwalDeb ty!