SECBA gets sneak preview of the D&P Cost of Capital Navigator


An enthusiastic audience watched a demo of the soon-to-be-released Duff & Phelps Cost of Capital Navigator at the annual business valuation conference hosted by the Southeast Chapter of Business Appraisers (SECBA) in Atlanta. The Navigator is an interactive online application that will replace the Duff & Phelps Risk Premium Toolkit and the hardcover version of the Valuation Handbook – U.S. Guide to Cost of Capital, explained Andrew Vey and Aaron Russo of Duff & Phelps. They demonstrated how the online tool guides you through the process of estimating cost of equity capital in a more efficient manner while reducing the chance of errors.

The Cost of Capital Navigator will contain all of the data originally included in the Valuation Handbook – U.S. Guide to Cost of Capital: the U.S. cost of capital data inputs (equity risk premia, size premia, industry risk premia, risk premia over the risk-free rate, risk-free rates) from two essential valuation data sets: the CRSP Deciles Size Study and the Risk Premium Report Study. Later in 2018, the Navigator will be updated to include additional data and information from the other three Valuation Handbooks as add-on modules.

Because all of the data and information will now be online, you’ll get it up to a full month sooner than you would with the old print version, they pointed out. Plus, quarterly updates will now be provided free of charge. You’ll also be able to produce supporting documentation without dealing with the long-form tables. The data tables themselves will not be accessible online nor will they be able to be printed, which was of some concern to the audience. Also, audience members needed it clarified—several times—that the Valuation Handbooks will no longer be available in hardcover form. Subscribers will be able to purchase a print version, but it will not include the data tables. The individual long-form tables will not be exportable from the Cost of Capital Navigator.

The full text of each annual version of the 2014-2018 (and beyond) Valuation Handbook - U.S. Guide to Cost of Capital will be available in the Cost of Capital Navigator. The full text of the most recent two years will be available to those who subscribe to the Basic version of the Navigator. The full text of each annual version (2014-2018, and beyond) will be available to those who subscribe to the Pro version of the Navigator.

The audience wanted to know whether there will be an Excel feature. Vey and Russo explained that the initial launch version does not include an Excel plug-in, but it will be added as an enhancement later in 2018. The Excel plug-in will only be available to Pro subscribers for an additional charge and will be available to Enterprise subscribers at no additional charge. The plug-in will allow those users to pull in any of the data available in the Cost of Capital Navigator database directly into a new spreadsheet or into their existing models.

The Cost of Capital Navigator is available from BVR, and you can watch a free demo and get more details at www.bvresources.com/Navigator.


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