Weighted average cost of capital (WACC)

Will COVID-19 increase the Cost of Capital in the GCC?

Cost of Capital represents the opportunity cost of all financial capital, primarily debt and equity, invested in an enterprise. ‘Opportunity cost’ also referred to as ‘hurdle cost’ or ‘discount rate’, is of primary importance in valuation and helps investors in arriving at the correct price of a company’s stock. Given the importance of this metric in creating value for shareholders, it is essential to compare the cost of capital for the GCC countries over the years. Key Points to be...