Welcome to "Cost of Capital and Valuation!" In this module, we learn how to estimate the current value of the cash flows that a firm is expected to generate in the future. This introductory section explains the structure of the module.
The main learning goals of this module are:
- Learn what the cost of capital is and how it is affected by financial leverage.
- Understand the various ways to capitalize free cash flows.
- Learn how to estimate the Weighted Average Cost of Capital (WACC) in any valuation situation.
- Learn how to estimate the cost of capital in an international context.
- Understand the simple mistakes we often make when "unlevering" and "relevering" betas.