Equilest

OCTOBER 9, 2024

Whether you're deciding how much debt to take on or how to manage equity financing, the right mix can lower your cost of capital and boost growth. Understanding Capital Structure Definition and components (equity, debt, and hybrid instruments). The Role of Debt in Capital Structure How debt impacts business growth.

Capital Structure 40

Capital Structure Equity Financing Equity Finance 40

Andrew Stolz

AUGUST 6, 2020

The first proposition of the M&M says that the value of leveraged firms (capital structure with a mix of debt and equity) and unleveraged firms (capital structure with only equity) are the same. Where V (unlevered) = company with no debt financing and V (levered) = company with some debt financing).

Debt Financing 52

Debt Financing Capital Structure Equity Finance 52

Equilest

JANUARY 8, 2023

Modigliani-Miller Theorem in the no-tax world states that the value of a firm is independent of its capital structure, meaning that the mix of debt and equity used by the firm has no effect on its overall value. . . . Firm A has a higher proportion of debt financing, while Firm B has a higher proportion of equity financing.

Weighted Average Cost of Capital 40

Weighted Average Cost of Capital Business Valuation Capital Structure Debt Financing 40

Benchmark Report

JULY 1, 2022

First, the financing needs to be raised with consideration of the company's operating cash flows. For example, if the business uses debt financing, it should have sufficient funds to cover the interest and repay the debt.

Debt Financing 52

Debt Financing Finance Equity Financing Banking 52

Lighter Capital

APRIL 17, 2024

In the fast-paced tech world, startups and equity dilution are nearly inseparable. Cash-strapped founders can use their equity to raise capital, compensate advisors, and attract the talent they need to turn a clever idea into a successful business. These days, equity capital is as expensive as it is elusive.

Equity 52

Equity Finance Debt Financing Start-ups 52

Peak Business Valuation

MAY 16, 2024

To finance these activities, you can sell equity ownership or take on debt. For more information, see Debt vs. Equity Financing. You may need cash to hire new employees or purchase more inventory. Both methods have their benefits.

Business Valuation 52

Business Valuation Appraisal Finance Debt Financing 52

Reynolds Holding

APRIL 25, 2023

For example, a firm engages in a debt-financed repurchase if the negative impact of the increased interest expense on EPS (through the denominator) is smaller than the positive impact associated with decreasing the number of shares (through the numerator). Growth firms will issue equity to pay for acquisitions; value firms won’t.

Net Present Value 59

Net Present Value Corporate Finance Finance Equity 59

Valutico

APRIL 17, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business.

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52

Valutico

APRIL 17, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business.

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52

Valutico

APRIL 12, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business.

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52