The traditional formula for the cost of equity is the dividend capitalization model and the capital asset pricing model (CAPM). The cost of equity is the return that a company requires for an ...

The two main formulas for determining the cost of equity are the capital asset pricing model (CAPM) and dividend discount model (DDM). Each formula serves a different purpose, with CAPM being the ...

Conversely, a lower WACC signals relatively low financing cost and less risk. "The formula uses the cost ... You can estimate a company's cost of equity using models like capital asset pricing ...