Equity shares equating the results of FCFF and FCFE methods

Bartlomiej Ceglowski; Bla´zej Podgórski

The aim of the article is to present the method of establishing equity shares in weight average cost of capital (WACC), in which the value of loan capital results from the fixed assumptions accepted in the financial plan (for example a schedule of loan repayment) and own equity is evaluated by means of a discount method. The described method causes that, regardless of whether cash flows are calculated as FCFF or FCFE, the result of the company valuation will be identical. -- weight average cost of capital ; discount rate ; free cash flow ; company valuation ; assessment of investment profitability

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Year of publication:	2012
Authors:	Ceglowski, Bartlomiej ; Podgórski, Bla´zej
Published in:	E-Finanse : finansowy kwartalnik internetowy. - Rzeszów : [Verlag nicht ermittelbar], ISSN 1734-039X, ZDB-ID 2631747-3. - Vol. 8.2012, 2, p. 34-43
Subject:	Aktie \| Share \| Kapitalkosten \| Cost of capital \| Cash Flow \| Cash flow \| Unternehmensbewertung \| Firm valuation \| Theorie \| Theory

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Type of publication:	Article
Type of publication (narrower categories):	Aufsatz in Zeitschrift ; Article in journal
Language:	English
Notes:	Systemvoraussetzung: Acrobat Reader
Other identifiers:	hdl:10419/66773 [Handle]
Classification:	G31 - Capital Budgeting; Investment Policy ; G32 - Financing Policy; Capital and Ownership Structure ; G39 - Corporate Finance and Governance. Other
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10009575858