{"id":601,"date":"2012-06-11T15:31:03","date_gmt":"2012-06-11T15:31:03","guid":{"rendered":"http:\/\/joapen.com\/blog\/?p=601"},"modified":"2012-06-14T15:38:23","modified_gmt":"2012-06-14T15:38:23","slug":"roic-wacc","status":"publish","type":"post","link":"https:\/\/joapen.com\/blog\/2012\/06\/11\/roic-wacc\/","title":{"rendered":"ROIC &#038; WACC"},"content":{"rendered":"<p><strong>Weighted Average Cost of Capital (WACC)<\/strong><\/p>\n<p>A calculation of a company&#8217;s cost of capital in which every source of capital is weighted in proportion to how much capital it contributes to the company. For example, if 75% of a company&#8217;s capital comes from stock and 25% comes from debt, measuring the cost of capital weights these accordingly. A high WACC indicates that a company is spending a comparatively large amount of money in order to raise capital, which means that the company may be risky. On the other hand, a low WACC indicates that the company acquires capital cheaply.<\/p>\n<p><a href=\"http:\/\/joapen.com\/blog\/wp-content\/uploads\/2012\/06\/WACC.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-603\" title=\"WACC\" src=\"http:\/\/joapen.com\/blog\/wp-content\/uploads\/2012\/06\/WACC.png\" alt=\"\" width=\"716\" height=\"325\" srcset=\"https:\/\/joapen.com\/blog\/wp-content\/uploads\/2012\/06\/WACC.png 716w, https:\/\/joapen.com\/blog\/wp-content\/uploads\/2012\/06\/WACC-300x136.png 300w, https:\/\/joapen.com\/blog\/wp-content\/uploads\/2012\/06\/WACC-500x226.png 500w\" sizes=\"auto, (max-width: 716px) 100vw, 716px\" \/><\/a><\/p>\n<p><strong>Return on invested capital (ROIC)<\/strong><\/p>\n<p>The amount, expressed as a percentage, that is earned on a company&#8217;s total capital calculated by dividing the total capital into earnings before interest, taxes, or dividends are paid.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Weighted Average Cost of Capital (WACC) A calculation of a company&#8217;s cost of capital in which every source of capital is weighted in proportion to how much capital it contributes to the company. For example, if 75% of a company&#8217;s capital comes from stock and 25% comes from debt, measuring the cost of capital weights &#8230; <a title=\"ROIC &#038; WACC\" class=\"read-more\" href=\"https:\/\/joapen.com\/blog\/2012\/06\/11\/roic-wacc\/\" aria-label=\"Read more about ROIC &#038; WACC\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35,38],"tags":[],"class_list":["post-601","post","type-post","status-publish","format-standard","hentry","category-finance","category-learning"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>ROIC &amp; WACC -<\/title>\n<meta name=\"description\" content=\"Weighted Average Cost of Capital (WACC) A calculation of a company&#039;s cost of capital in which every source of capital is weighted in proportion to how - joapen projects\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/joapen.com\/blog\/2012\/06\/11\/roic-wacc\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"ROIC &amp; 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