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New Risk Premium Calculator facilitates cost of equity estimates, enhances usability of Report now in 16th year of publication
The Duff & Phelps 2011 Risk Premium Report - designed to help finance professionals assess risk and more accurately estimate the cost of equity capital for purposes of business valuation, capital budgeting, feasibility studies and corporate finance decisions - is now available in conjunction with a new, web-based Risk Premium Calculator. The Calculator enhances the usability of the Report and automatically calculates levered and unlevered cost of equity capital estimates by analyzing up to 18 inputs provided by the user.
"This year's Risk Premium Report and the Calculator make it easier than ever for companies to calculate equity risk and size premia," said Roger Grabowski, a managing director at financial advisory and investment banking firm Duff & Phelps, co-author of "Cost of Capital: Applications and Examples 4th ed." (Wiley, 2010) and leader of Duff & Phelps' proprietary research on risk premium issues since 1996. "The Calculator provides rapid access to cost of equity capital estimates and valuable contextual information. It's an invaluable tool for assessing the risk profile of a capital project and the expected rate of return."
The 2011 Risk Premium Report employs Standard & Poor's Computstat database to develop risk measures and realized returns historically experienced by equity investors, including comparable returns based on both company size and fundamental company risk. In addition, the Report includes special sections dedicated to the analysis of companies associated with a high degree of financial risk.
The Risk Premium Calculator quickly delivers four cost of equity capital estimates using multiple models, including the capital asset pricing model (CAPM) and buildup models. Features include a built-in risk free rate identification mechanism, automatic equity risk premium adjustments, and an instantly delivered executive summary that includes sourcing, key inputs, and a concluded range of cost of equity capital estimates for the subject company.
The Duff & Phelps Risk Premium Calculator is sold exclusively through Business Valuation Resources (BVR).
Click here to learn more about the Calculator or to purchase the Calculator from BVR.
Click here to access a complimentary webinar that describes the Calculator and its functionality.
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