WACC project

    When calculating the cost of debt, if the company has only callable bonds you can use the credit rating information instead. For details see project instructions page 2 (top).

    Now if the credit rating is below A, then use the option-adjusted spread published at the following website (depending on the credit rating):
    https://fred.stlouisfed.org/categories/32297

    Add the spread (most recent data) to your risk-free rate, and use that as your estimate for cost of debt.

    Please reference your appendices within the text: e.g. (See Appendix A).
    I have attached a sample for Target Corp, which shows the 5-year monthly price/return info, the regression output, and the WACC summary table.

    On the format and content of the spreadsheet required for the WACC project. You can use this format to complete your spreadsheet. Please note that you should also include data for 3-year weekly and 1-year daily price/return, and regression output.

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