Duff & Phelps, LLC Risk Premium Report

Pre-order Today - The 2010 Report (Available February 15, 2010)
Exclusive Bonus:  You’ll get the Cost of Capital Reader for free when you order the 2010 Report.  The Reader compiles the best cost of capital articles from the past year as well as some evergreen content – available only through BVR. Plus, you'll get the article Cost of Capital Estimation in the Current Distressed Environment article by Roger J. Grabowski, published in the Journal of Applied Research in Accounting and Finance (JARAF).

Pre-order Your 2010 Risk Premium Report Today - $265.00 (PDF will be e-mailed to you - Cost of Capital Reader included Free!)

Order past reports from 1996-2009 - $175.00 each or $895.00 for all past reports!

View an Excerpt from the 2009 Duff & Phelps Risk Premium Report

The 2010 edition of the Risk Premium Report, authored by Roger Grabowski and David King, offers even more defensible cost of capital measures, particularly for small target companies. D&P presents historical equity risk premiums (ERPs) and size premiums for 25 size ranked portfolios using 8 alternative measures of company size. The rate of return figures are also adjusted for factors that skew other ERP studies, including the presence of distressed securities in the database, and the impact of firms that delist.

Why the Duff & Phelps Risk Premium Report is the Best Source for Cost of Capital Data

• Size study based on eight measures:
  • Three measures of equity size:
    • Market capitalization (Morningstar's Stocks, Bonds, Bills and Inflation's only size measure)
    • Book value
    • Net income (5-year average)
  • Five measures of company size:
    • MVIC
    • Total assets
    • EBITDA (5-year average)
    • Sales
    • Number of employees
      
      
• 25 size-ranked categories (instead of 10 deciles) for use in build-up and CAPM methods of developing discount rates
  
  
• Non-market value-based measures eliminate the need to “guess” size before developing discount rate
  
  
• High-risk companies that artificially increase ERP are segregated in a separate category for valuing similar companies
  
  
• Historical returns since 1963 are more consistent with current estimates of market risk premium than 1926 data
  
  
• Risk study based on 3 fundamental company risk measures provides returns for build-up method independent of size (returns based on company-specific risk)
  
  
• Comparisons of company size measures and risk measures that ensure ERP best matches the risk of your subject company  
  
  
• Data based on Standard & Poor’s Compustat database of public company size and risk data
  
  

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