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Weighted Average Cost of Capital Explained – Formula and Meaning

Valutico

The beta factor is used to calculate the cost of equity in the WACC formula and is a measure of a stock’s systematic risk, or the risk associated with the overall market. On the other hand, firms operating in less risky industries may have access to lower cost financing options and consequently have a lower WACC.

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Weighted Average Cost of Capital Explained – Formula and Meaning

Valutico

The beta factor is used to calculate the cost of equity in the WACC formula and is a measure of a stock’s systematic risk, or the risk associated with the overall market. On the other hand, firms operating in less risky industries may have access to lower cost financing options and consequently have a lower WACC.

article thumbnail

Weighted Average Cost of Capital Explained – Formula and Meaning

Valutico

The beta factor is used to calculate the cost of equity in the WACC formula and is a measure of a stock’s systematic risk, or the risk associated with the overall market. On the other hand, firms operating in less risky industries may have access to lower cost financing options and consequently have a lower WACC.