The weighted average cost of capital is a critical component of any business valuation. While there is wide agreement regarding the basic building blocks of the WACC, there is much less agreement regarding how to estimate those components. Much appraiser ink has been spilled over the past two decades describing how to estimate specific components, sometimes in excruciating detail. But has increasing precision done anything to promote accuracy?
In this webinar, Travis explores ways to bring market evidence to bear in evaluating the reasonableness of WACC estimates. Topics of discussion include, but are not limited to:
- Traditional techniques for measuring the WACC
- Challenges associated with measuring various components
- Ex post vs. ex ante perspective
- Review of market evidence regarding WACC
- Review of market evidence regarding the size effect
Travis is the co-author of An Integrated Theory of Business Valuation with Z. Christopher Mercer. In addition, he leads Mercer Capital’s Financial Reporting Valuation Group and is a frequent speaker on fair value accounting topics to audiences of financial executives, auditors, and valuation specialists at professional conferences and other events across the country. Travis also leads Mercer Capital’s Private Equity industry team and publishes a quarterly newsletter, Portfolio Valuation: Private Equity Marks & Trends. He also contributes regularly to Mercer Capital’s Financial Reporting Blog.