This set of spreadsheets allow you to
• Estimate the right discount rate to use for your firm, starting with the risk premium in your cost of equity and concluding with the cost of capital for your firm.
• Convert R&D and operating leases into capitalized assets
• Estimate the right capital expenditures and diagnose the terminal value assumptions to see if they are reasonable. Spreadsheets included:
• readme1s.xls - This file describes the programs in this section and provides some insights into their usage. • wacccalc.xls - This spreadsheet allows you to estimate the cost of capital for your firm. • cpxest.xls - This program summarizes the three approaches that can be used to estimate the net capital expenditures for a firm, when it reaches stable growth. • oplease.xls - This program converts operating lease expenses into financing expenses and restates operating income and debt outstanding. • R&DConv.xls - This program converts R& D expenses from operating to capital expenses, estimates a value for the research asset and restates operating income. • implprem.xls - This spreadsheet calculates the implied risk premium in a market. This can be used in discounted cashflow valuation to do market neutral valuation.