Cost of Capital: Applications and Examples, + Website, 5th Edition

Praise for Cost of Capital: Applications and Examples, Fifth Edition

"Shannon Pratt and Roger Grabowski have produced a remarkably comprehensive review of the subject… it is a work that valuation practitioners, CFOs, and others will find an invaluable reference."
--Professor Richard Brealey, London Business School (from the Foreword)

"Estimating the cost of capital is critical in determining the valuation of assets, in evaluating the capital structure of corporations, and in estimating the long-run expected return of investments. Shannon Pratt and Roger Grabowski have the most thorough text on the subject, not only providing various estimation methods, but also numerous ways to use the cost of capital."
--Professor Roger G. Ibbotson, Yale School of Management; Former chairman and founder of Ibbotson Associates; Chairman, founder, and CIO of Zebra Capital

"The fifth edition of Cost of Capital is the most thorough and best treatment of the cost of capital now available."
--Jerald E. Pinto, PhD, CFA, Director, Curriculum Projects, CFA Institute

"Cost of Capital, Fifth Edition is the most comprehensive, up-to-date, accessible treatment of concepts related to estimating cost of capital. Shannon Pratt and Roger Grabowski do an exceptional job of blending together theory and practice. This book clearly describes the concepts and illustrates the methods used for estimating cost of capital for a broad range of purposes, under virtually any circumstances that a practitioner is likely to encounter. This is the cost of capital book that every practitioner should have in his or her valuation library."
--Professor Robert Parrino, CFA, Lamar Savings Centennial Professor of Finance, University of Texas at Austin

"This book helps managers, valuators, students and professors to estimate in a sensible way the cost of capital of any company. It also helps the reader to think about the nature of the required return to equity rather than to just apply a recipe."
--Professor Pablo Fernández López, PricewaterhouseCoopers; Professor of Corporate Finance, IESE Business School, University of Navarra

"Valuation practitioners and others who use the cost of capital in their valuation measurements are faced with the dilemma of how to be broadly aware of all there is to know about the development of the cost of capital. Shannon Pratt and Roger Grabowski have done a masterful job of creating a single source of knowledge for those who calculate and use the cost of capital in their analyses. Cost of Capital, Fifth Edition blends information about theory, practice, and common sources of data, with a comprehensive overview of specific areas of application. Contrasting points of view are furnished, allowing the practitioner to decide which theory or practice is best suited for a particular set of facts and circumstances. All who measure value should be aware of this important work."
--Anthony V. (Tony) Aaron, Quality and Risk Management Leader, Ernst & Young Valuation and Business Modeling Services; Vice Chairman, Board of Trustees of the Appraisal Foundation

"Despite years of study, thinking on the cost of capital continues to evolve. Cost of Capital, Fifth Edition is a highly accessible text that provides a comprehensive review of theory, data, practice and applications in developing and applying cost of capital estimates. The fifth edition includes expanded content and has been restructured in several areas to further enhance its readability. The text carefully balances the need for an in-depth treatment that is accessible to busy professionals. It is required reading for all finance professionals including corporate managers, investment professionals and appraisers. As college-level education focusing on valuation increases, educators will find the fifth edition invaluable with numerous supplemental materials."
--Raymond Rath, ASA, CFA, Managing Director, Globalview Advisors LLC; Author, “Private Company Valuation” in CFA Institute’s second edition of Equity Asset Valuation