Kroll-recommended ERP remains at 5.5%—for now

BVWireIssue #258-1
March 6, 2024

cost of capital
cost of capital, discount rate, risk analysis, cost of equity, equity risk premium (ERP)

The latest cost of capital infographic from Kroll has the firm’s recommended U.S. equity risk premium reaffirmed at 5.5% when developing USD-denominated discount rates. But the global economic picture is such that “equity risk premia is likely to come down,” notes Carla Nunes, managing director, Valuation Digital Solutions/Office of Professional Practice at Kroll. The infographics, which include global market data and key economic metrics, also now include long-term real GDP and inflation forecasts.
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