Archive 2014-73: Grabowski on Cost of Capital 5th Edition




Archive 2014-73: Grabowski on Cost of Capital – An Update on What’s New in the April 2014 Cost of Capital: Applications and Examples, 5th ed. Book

**Webinar 73 Live Broadcast Date: March 25, 2014**

presented by Roger J. Grabowski, ASA Managing Director, Duff & Phelps LLC

VPS StraightTalk Webinar Series: Grabowski on Cost of Capital

Pratt and Grabowski will release Cost of Capital Applications and Examples, 5th edition, in April 2014. In this webinar, Grabowski will summarize important and controversial areas identified through his many years of research, including all that is new in the 5th edition of this seminal book on cost of capital. You must attend this webinar if you want to stay current on cost of capital. [NOTE: This presentation will also include a brief review of the new Valuation Handbook, which serves as a replacement to the discontinued Morningstar/Ibbotson SBBI Valuation Yearbook with CRSP size premia data plus the Duff & Phelps Risk Premium Report data.]

Learning Objectives:

  • The participant will be given a pre-April 2014 release date view of new and expanded data and information from the top book in the area of cost of
  • The participant will learn what the current recommended equity risk premium should be and how it is calculated
  • The participant will learn about how to address company-specific risk
  • The participant will learn many new details concerning the size effect and premium
  • The participant will learn how to adjust discount and cap rates for changes in risk and changes in economic income, e.g., pretax income

Webinar Outline

Summary of important areas in the April 2014 Cost of Capital: Applications and Examples, 5th edition

  • How the Duff & Phelps recommended equity risk premium is derived and why it changes over time
  • Company-specific risk – factors to consider and how to measure it
  • Size premium – criticisms and added evidence of its existence and magnitude
  • Size premium vs. liquidity premium
  • Adjusting discount and cap rates for different measures of economic income including pretax rates
  • How to change discount rates to reflect changes in risk
  • The relationship of the equity risk premium and the risk-free rate
  • Thoughts on the use of cost of capital surveys including the Pepperdine surveys
  • The modified capital asset pricing model vs. the build-up model – which one is better
  • How to use and reconcile the data from the new 2014 Valuation Handbook – Guide to Cost of Capital


Included in this downloadable archived webinar package:

  • Audio/Video file
  • Webinar transcript
  • Original Webinar handouts

The archived webinar package is an Adobe Presenter PDF file that allows you to view the video of the webinar with the synced audio so that you see the presentation just as it was presented “live.” The Presenter format also allows for easy navigation through the webinar so you can quickly go to a specific section in the presentation. The handout materials are included in the file. To view the Webinar Presenter file, you must have Adobe Reader software version 9 or higher. You can download the free current version of Adobe Reader at

Additional information

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