NEW YORK--(BUSINESS WIRE)--Duff & Phelps Corporation, the premier global valuation and corporate finance advisor, today announced publication of the 2014 Valuation Handbook-Guide to Cost of Capital. The new book and companion Risk Premium Calculator help finance professionals estimate the cost of capital, an essential input to assess the feasibility of every merger and acquisition transaction and other strategic investments.
Determining the appropriate cost of capital, or discount rate, can be one of the most challenging aspects of any valuation analysis, particularly in volatile markets or during periods of economic uncertainty. Duff & Phelps’ new resources provide the approaches and data needed to make reliable estimates of this critical valuation assumption.
“With approximately $1.6 trillion in cash on corporate balance sheets-and an uptick in M&A activity thus far in 2014-reliable cost of capital estimates are imperative to achieving successful financial returns,” said Roger Grabowski, Duff & Phelps Managing Director and co-author of Cost of Capital, Applications and Examples. “We are pleased to provide corporate finance professionals and valuation practitioners with a comprehensive, definitive resource to develop estimates of cost of capital.”
The 2014 Valuation Handbook-Guide to Cost of Capital incudes the Duff & Phelps long-standing Risk Premium Report along with all of the critical year-end data that was previously available in the now discontinued Ibbotson® Stock, Bonds, Bills and Inflation (SBBI®) Valuation Yearbook. The new book will be updated annually.
In addition to the new 2014 Valuation Handbook-Guide to Cost of Capital, related resources that are now available include:
- Risk Premium Calculator: web-based resource for calculating cost of equity for users of data published in the Valuation Handbook-Guide to Cost of Capital. The model enables users to enter 1 - 18 inputs. Based upon these data points, the calculator delivers an executive summary, detailed results and four cost of equity estimates. This valuable tool also delivers historical equity risk premiums and size premiums for 25 size ranked portfolios using 8 alternative measures of company size.
- Cost of Capital, Applications and Examples, 4th Ed. (Chinese translation, 2013): co-authored by Duff & Phelps Managing Director Roger Grabowski. This is the first edition to be translated in response to increased demand for cost of capital resources in Asia.
Resources soon to be made available include:
- Cost of Capital, Applications and Examples, 5th Ed. (Wiley, 2014): co-authored by Duff & Phelps Managing Director Roger Grabowski, the 5th edition of this definitive reference book is an indispensable resource for a broad audience of valuation practitioners, investment bankers, CFOs, CPAs and finance professionals. The 5th edition includes expert commentary on the calculation of cost of capital for purposes of financial reporting and tax valuation, transfer pricing, litigation support and mergers and acquisitions, and is expected to ship in April of 2014.
- In summer 2014, the American Bar Association will publish The Lawyer’s Guide to Cost of Capital, co-authored by Duff & Phelps Managing Director Roger Grabowski. This text is designed to simplify the theoretical discussions to aid attorneys in understanding cost of capital issues in disputes. The book also contains chapters that summarize the various courts’ views on cost of capital.
The 2014 Valuation Handbook-Guide to Cost of Capital is now available for purchase through Business Valuation Resources, ValuSource and the AICPA. The Risk Premium Calculator is available through Business Valuation Resources. Advance orders of Cost of Capital, Applications and Examples, 5th Ed. can be made through Wiley .
On April 22 at noon Eastern Time and 4:00 p.m. GMT, Duff & Phelps will host a webcast, Calculating Cost of Capital-Matching Risk and Return.
To learn more about Duff & Phelps’ valuation and cost of capital expertise, please visit www.duffandphelps.com/cost of capital.
About Duff & Phelps
Duff & Phelps is the premier global valuation and corporate finance advisor with expertise in complex valuation, dispute consulting, M&A and restructuring. The firm’s more than 1,000 employees serve a diverse range of clients from offices in North America, Europe and Asia. For more information, visit www.duffandphelps.com.
M&A advisory, capital raising and restructuring services in the United States are provided by Duff & Phelps Securities, LLC. Member FINRA/SIPC. Pagemill Partners is a Division of Duff & Phelps Securities, LLC. M&A advisory and capital raising services in the United Kingdom and Germany are provided by Duff & Phelps Securities Ltd., which is authorized and regulated by the Financial Conduct Authority.