Date updated: 5-Jan-20

Created by: Aswath Damodaran, adamodar@stern.nyu.edu

What is this data? Cost of equity and capital (updateable)
Home Page: http://www.damodaran.com
Data website: http://www.stern.nyu.edu/~adamodar/New_Home_Page/data.html
Companies in each industry: http://www.stern.nyu.edu/~adamodar/pc/datasets/indname.xls
Variable definitions: http://www.stern.nyu.edu/~adamodar/New_Home_Page/datafile/variab
To update this spreadsheet, enter the following
Long Term Treasury bond rate =
Risk Premium to Use for Equity =
Global Default Spread to add to cost of debt =
Do you want to use the marginal tax rate for cost of debt?
If yes, enter the marginal tax rate to use

These costs of capital are in US$. To convert to a different currency, please enter
Expected inflation rate in local currency = 6.00%
Expected inflation rate in US $ = 1.50%

Industry Name Number of Firms Beta

Advertising 47 1.44
Aerospace/Defense 77 1.23
Air Transport 18 1.44
Apparel 51 1.06
Auto & Truck 13 1.10
Auto Parts 46 1.21
Bank (Money Center) 7 1.00
Banks (Regional) 611 0.57
Beverage (Alcoholic) 21 1.13
Beverage (Soft) 34 1.22
Broadcasting 27 1.21
Brokerage & Investment Banking 39 1.46
Building Materials 42 1.23
Business & Consumer Services 165 1.07
Cable TV 14 1.11
Chemical (Basic) 43 1.37
Chemical (Diversified) 6 1.85
Chemical (Specialty) 94 1.14
Coal & Related Energy 22 1.40
Computer Services 106 1.20
Computers/Peripherals 48 1.75
Construction Supplies 44 1.36
Diversified 23 1.40
Drugs (Biotechnology) 503 1.43
Drugs (Pharmaceutical) 267 1.36
Education 35 1.61
Electrical Equipment 113 1.44
Electronics (Consumer & Office) 20 1.28
Electronics (General) 153 1.15
Engineering/Construction 54 1.60
Entertainment 107 1.33
Environmental & Waste Services 82 1.27
Farming/Agriculture 31 0.89
Financial Svcs. (Non-bank & Insurance) 232 0.73
Food Processing 88 0.88
Food Wholesalers 17 0.87
Furn/Home Furnishings 35 1.08
Green & Renewable Energy 22 1.07
Healthcare Products 242 1.04
Healthcare Support Services 128 1.17
Heathcare Information and Technology 129 1.24
Homebuilding 32 0.83
Hospitals/Healthcare Facilities 36 1.22
Hotel/Gaming 65 1.26
Household Products 127 1.03
Information Services 69 1.09
Insurance (General) 19 0.74
Insurance (Life) 24 1.08
Insurance (Prop/Cas.) 51 0.68
Investments & Asset Management 192 1.03
Machinery 120 1.25
Metals & Mining 92 1.31
Office Equipment & Services 22 1.65
Oil/Gas (Integrated) 4 1.30
Oil/Gas (Production and Exploration) 269 1.48
Oil/Gas Distribution 24 1.02
Oilfield Svcs/Equip. 136 1.58
Packaging & Container 24 0.99
Paper/Forest Products 15 1.54
Power 52 0.58
Precious Metals 83 1.44
Publishing & Newspapers 31 1.07
R.E.I.T. 234 0.68
Real Estate (Development) 20 1.24
Real Estate (General/Diversified) 12 1.63
Real Estate (Operations & Services) 57 0.93
Recreation 63 0.90
Reinsurance 2 0.82
Restaurant/Dining 77 0.97
Retail (Automotive) 26 1.33
Retail (Building Supply) 17 1.36
Retail (Distributors) 80 1.28
Retail (General) 18 1.14
Retail (Grocery and Food) 13 0.59
Retail (Online) 70 1.23
Retail (Special Lines) 89 1.03
Rubber& Tires 4 0.98
Semiconductor 72 1.29
Semiconductor Equip 39 1.28
Shipbuilding & Marine 10 2.17
Shoe 11 0.87
Software (Entertainment) 86 1.29
Software (Internet) 30 1.67
Software (System & Application) 363 1.20
Steel 32 1.62
Telecom (Wireless) 18 1.14
Telecom. Equipment 91 0.89
Telecom. Services 67 1.05
Tobacco 17 1.68
Transportation 18 1.31
Transportation (Railroads) 8 2.24
Trucking 33 1.37
Utility (General) 16 0.28
Utility (Water) 17 0.68
Total Market 7053 1.13
Total Market (without financials) 5878 1.21
@stern.nyu.edu
teable) US companies

amodar/New_Home_Page/data.html
amodar/pc/datasets/indname.xls
amodar/New_Home_Page/datafile/variable.htm

1.92% Standard Deviation

5.20%
0.00%
Yes
25%

Cost of Equity E/(D+E) Std Dev in Stock

9.41% 54.03% 62.38%
8.32% 80.46% 38.74%
9.38% 49.16% 31.74%
7.41% 70.54% 51.10%
7.61% 37.75% 35.02%
8.22% 66.28% 50.43%
7.12% 36.00% 17.74%
4.87% 61.38% 18.26%
7.78% 76.17% 42.46%
8.26% 83.87% 57.08%
8.23% 50.39% 32.65%
9.52% 27.15% 27.36%
8.32% 75.72% 30.78%
7.46% 76.74% 43.80%
7.72% 62.43% 25.03%
9.03% 62.08% 51.96%
11.55% 55.97% 35.92%
7.82% 77.81% 48.36%
9.18% 55.65% 54.71%
8.18% 69.13% 45.52%
11.01% 86.59% 50.41%
9.01% 71.36% 29.91%
9.21% 76.24% 38.16%
9.37% 87.27% 67.45%
9.00% 87.01% 77.14%
10.27% 74.81% 37.64%
9.43% 82.65% 53.67%
8.55% 82.87% 62.17%
7.90% 84.58% 42.78%
10.23% 71.80% 33.19%
8.85% 83.29% 55.57%
8.52% 75.94% 44.34%
6.57% 61.58% 46.88%
5.73% 10.18% 25.70%
6.47% 72.79% 31.53%
6.43% 69.47% 31.58%
7.52% 67.41% 43.38%
7.50% 47.03% 53.76%
7.34% 88.30% 53.09%
8.01% 71.48% 49.95%
8.39% 87.21% 53.86%
6.22% 69.35% 36.55%
8.27% 43.44% 42.63%
8.48% 63.93% 34.10%
7.28% 85.34% 50.91%
7.60% 89.38% 37.80%
5.78% 70.71% 31.00%
7.52% 50.63% 25.13%
5.45% 79.14% 21.71%
7.26% 64.76% 27.88%
8.40% 80.74% 35.39%
8.73% 72.35% 73.25%
10.48% 64.57% 31.28%
8.68% 78.85% 28.62%
9.61% 63.94% 59.37%
7.20% 52.72% 32.66%
10.13% 67.27% 53.50%
7.07% 60.26% 33.14%
9.91% 71.71% 37.37%
4.91% 57.97% 18.49%
9.38% 84.48% 82.64%
7.47% 59.68% 38.18%
5.48% 54.24% 19.86%
8.35% 58.82% 47.22%
10.41% 68.76% 21.35%
6.77% 62.97% 39.15%
6.61% 74.80% 47.53%
6.18% 77.51% 14.87%
6.98% 70.59% 38.76%
8.85% 57.85% 37.37%
8.99% 79.55% 47.29%
8.57% 62.17% 42.83%
7.87% 75.70% 40.40%
4.98% 50.85% 37.18%
8.32% 88.60% 55.97%
7.28% 58.63% 44.95%
7.03% 35.97% 57.59%
8.61% 89.45% 43.69%
8.57% 89.15% 41.06%
13.22% 64.22% 34.05%
6.43% 91.91% 37.56%
8.62% 96.34% 61.37%
10.62% 83.05% 44.78%
8.14% 91.18% 49.50%
10.34% 68.04% 39.39%
7.86% 43.25% 41.85%
6.57% 85.31% 46.30%
7.37% 55.81% 54.47%
10.66% 77.79% 38.49%
8.71% 64.84% 27.99%
13.57% 79.22% 18.25%
9.06% 63.34% 41.85%
3.40% 59.90% 13.11%
5.48% 73.66% 17.88%
7.79% 63.29% 42.36%
8.21% 75.99% 46.41%
 YouTube Video Guide
panies

Cost of Debt Lookup Table (based on std dev in stock prices)

Standard Deviation Basis Spread
0 0.25 0.80%
0.25 0.4 1.35%
0.4 0.65 1.75%
0.65 0.75 2.50%
0.75 0.9 5.00%
0.9 1 6.50%
1 10 7.50%

Cost of Debt Tax Rate After-tax Cost of Debt D/(D+E) Cost of Capital
3.67% 4.13% 2.75% 45.97% 6.35%
3.27% 8.54% 2.45% 19.54% 7.18%
3.27% 18.47% 2.45% 50.84% 5.86%
3.67% 11.11% 2.75% 29.46% 6.04%
3.27% 5.93% 2.45% 62.25% 4.40%
3.67% 7.25% 2.75% 33.72% 6.37%
2.72% 19.36% 2.04% 64.00% 3.87%
2.72% 17.46% 2.04% 38.62% 3.78%
3.67% 6.62% 2.75% 23.83% 6.58%
3.67% 4.00% 2.75% 16.13% 7.37%
3.27% 13.31% 2.45% 49.61% 5.36%
3.27% 12.83% 2.45% 72.85% 4.37%
3.27% 16.26% 2.45% 24.28% 6.90%
3.67% 8.32% 2.75% 23.26% 6.37%
3.27% 14.55% 2.45% 37.57% 5.74%
3.67% 6.66% 2.75% 37.92% 6.65%
3.27% 11.89% 2.45% 44.03% 7.55%
3.67% 11.01% 2.75% 22.19% 6.70%
3.67% 0.97% 2.75% 44.35% 6.33%
3.67% 8.92% 2.75% 30.87% 6.50%
3.67% 6.21% 2.75% 13.41% 9.90%
3.27% 15.82% 2.45% 28.64% 7.13%
3.27% 6.68% 2.45% 23.76% 7.60%
4.42% 0.61% 3.32% 12.73% 8.60%
6.92% 1.36% 5.19% 12.99% 8.51%
3.27% 6.56% 2.45% 25.19% 8.30%
3.67% 3.94% 2.75% 17.35% 8.27%
3.67% 5.45% 2.75% 17.13% 7.56%
3.67% 6.65% 2.75% 15.42% 7.11%
3.27% 9.44% 2.45% 28.20% 8.03%
3.67% 1.93% 2.75% 16.71% 7.83%
3.67% 4.14% 2.75% 24.06% 7.13%
3.67% 5.91% 2.75% 38.42% 5.10%
3.27% 14.42% 2.45% 89.82% 2.79%
3.27% 6.44% 2.45% 27.21% 5.38%
3.27% 7.79% 2.45% 30.53% 5.22%
3.67% 8.15% 2.75% 32.59% 5.97%
3.67% 1.52% 2.75% 52.97% 4.98%
3.67% 3.52% 2.75% 11.70% 6.81%
3.67% 8.26% 2.75% 28.52% 6.51%
3.67% 3.84% 2.75% 12.79% 7.67%
3.27% 17.02% 2.45% 30.65% 5.07%
3.67% 7.50% 2.75% 56.56% 5.15%
3.27% 12.52% 2.45% 36.07% 6.31%
3.67% 5.93% 2.75% 14.66% 6.61%
3.27% 8.34% 2.45% 10.62% 7.06%
3.27% 16.10% 2.45% 29.29% 4.81%
3.27% 14.78% 2.45% 49.37% 5.02%
2.72% 14.03% 2.04% 20.86% 4.74%
3.27% 7.47% 2.45% 35.24% 5.57%
3.27% 12.32% 2.45% 19.26% 7.26%
4.42% 1.96% 3.32% 27.65% 7.24%
3.27% 15.29% 2.45% 35.43% 7.63%
3.27% 24.54% 2.45% 21.15% 7.37%
3.67% 3.70% 2.75% 36.06% 7.14%
3.27% 5.46% 2.45% 47.28% 4.96%
3.67% 5.06% 2.75% 32.73% 7.72%
3.27% 12.18% 2.45% 39.74% 5.24%
3.27% 10.41% 2.45% 28.29% 7.80%
2.72% 13.27% 2.04% 42.03% 3.71%
6.92% 1.75% 5.19% 15.52% 8.73%
3.27% 8.10% 2.45% 40.32% 5.45%
2.72% 1.92% 2.04% 45.76% 3.90%
3.67% 2.19% 2.75% 41.18% 6.04%
2.72% 6.55% 2.04% 31.24% 7.80%
3.27% 5.58% 2.45% 37.03% 5.17%
3.67% 8.21% 2.75% 25.20% 5.64%
2.72% 17.55% 2.04% 22.49% 5.25%
3.27% 6.57% 2.45% 29.41% 5.65%
3.27% 14.04% 2.45% 42.15% 6.15%
3.67% 14.90% 2.75% 20.45% 7.71%
3.67% 11.96% 2.75% 37.83% 6.37%
3.67% 15.49% 2.75% 24.30% 6.62%
3.27% 12.78% 2.45% 49.15% 3.74%
3.67% 2.92% 2.75% 11.40% 7.68%
3.67% 11.89% 2.75% 41.37% 5.41%
3.67% 20.75% 2.75% 64.03% 4.29%
3.67% 6.15% 2.75% 10.55% 7.99%
3.67% 9.71% 2.75% 10.85% 7.94%
3.27% 4.89% 2.45% 35.78% 9.37%
3.27% 13.98% 2.45% 8.09% 6.11%
3.67% 2.58% 2.75% 3.66% 8.40%
3.67% 1.23% 2.75% 16.95% 9.29%
3.67% 2.60% 2.75% 8.82% 7.67%
3.27% 9.25% 2.45% 31.96% 7.82%
3.67% 5.89% 2.75% 56.75% 4.96%
3.67% 4.31% 2.75% 14.69% 6.01%
3.67% 4.17% 2.75% 44.19% 5.33%
3.27% 11.48% 2.45% 22.21% 8.83%
3.27% 12.76% 2.45% 35.16% 6.51%
2.72% 12.24% 2.04% 20.78% 11.17%
3.67% 16.73% 2.75% 36.66% 6.74%
2.72% 13.45% 2.04% 40.10% 2.85%
2.72% 10.01% 2.04% 26.34% 4.57%
3.67% 7.32% 2.75% 36.71% 5.94%
3.67% 5.81% 2.75% 24.01% 6.90%
Cost of Capital (Local Currency)
11.06%
11.93%
10.55%
10.74%
9.03%
11.09%
8.48%
8.38%
11.30%
12.13%
10.04%
9.00%
11.64%
11.08%
10.43%
11.38%
12.32%
11.43%
11.04%
11.22%
14.77%
11.88%
12.37%
13.42%
13.32%
13.10%
13.07%
12.33%
11.86%
12.82%
12.61%
11.88%
9.76%
7.34%
10.05%
9.88%
10.66%
9.64%
11.54%
11.23%
12.45%
9.73%
9.81%
11.02%
11.34%
11.80%
9.45%
9.67%
9.38%
10.25%
12.01%
11.99%
12.40%
12.13%
11.89%
9.61%
12.49%
9.90%
12.58%
8.30%
13.55%
10.12%
8.51%
10.74%
12.57%
9.83%
10.32%
9.91%
10.33%
10.86%
12.49%
11.09%
11.35%
8.34%
12.46%
10.08%
8.92%
12.78%
12.72%
14.22%
10.82%
13.21%
14.13%
12.44%
12.60%
9.62%
10.71%
10.00%
13.66%
11.23%
16.10%
11.48%
7.41%
9.21%
10.64%
11.64%
End Game

Variable
Number of firms
Beta
Cost of Equity

D/(D+E)

Cost of debt

After-tax Cost of Debt

Cost of Capital

Cost of Capital (local currency)

To estimate the hurdle rate (required return) on both equity and overall capital invested for firms.

Explanation
Number of firms in the indusry grouping.
Average regression beta across companies in the group.
Risk free Rate + Beta * Equity Risk Premium, in US $
Total Debt (including lease debt)/ (Total Debt (including lease debt)+
Market Cap), aggregated across all firms in group, with all numbers other
than market cap coming from most recent balance sheet; market cap is as
of last day of the most recent year.

Pre-tax cost of borrowing for sector, estimated based upon the standard
deviation of equity.
Pre-tax cost of borrowing (1- Marginal tax rate), in US $
Cost of Equity * (Equity/ (Debt + Equity)) + Cost of Debt (1- Marginal tax
rate) *(Debt/ (Debt + Equity)), with aggregated debt and market equity
values across all companies in the sector, using most recent balance sheet
for debt and most recent year-end for equity.

You can convert the $ cost of capital for a sector into any other currency,
if you can estimate an expected inflation rate for the local currency.
equity and overall capital invested for firms.

Why?
Law of large numbers?
Relative risk of sector
Required return on equity, given equity risk (beta).
Measure of debt used, as a proportion of overall funding (based upon market value)

This is an approximation, but the alternatives are not attractive. I could estimate the average cost of debt
across firms in the group, but many of them are unrated and there are outliers.
Interest saves you taxes, at the margin.
Required return on invested capital.

Required return on invested capital, converted into local currency.