Abstract

In this paper, we present the cost of capital estimation for highway concessionaires in Chile. We estimated the cost of equity and the cost of debt and determined the capital structure for each one of twenty-four concessionaires that operate highways. We based our estimations on the developments of Sharpe (1964), Modigliani and Miller (1958), and Maquieira (2009), which were also compared with the Brusov et al. (2015) developments. We collected stock prices for different highway concessionaires around the world from Google Finance and Reuters’ websites in order to determine the Beta of equity using a representative company. After that, we estimated the cost of equity considering Hamada (1969) and a Capital Asset Pricing Model. Then, we estimated the cost of capital using the cost of debt and the capital structure of Chile’s highway concessionaires. With all above, we were able to determine the Weighted Average Cost of Capital (WACC) for highway concessions which ranges from 5.49 to 6.62%.

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The different versions of the original document can be found in:

http://downloads.hindawi.com/journals/jat/2018/2153536.xml,
http://dx.doi.org/10.1155/2018/2153536 under the license http://creativecommons.org/licenses/by/4.0
https://www.hindawi.com/journals/jat/2018/2153536,
https://core.ac.uk/display/153611018,
https://academic.microsoft.com/#/detail/2789737725 under the license http://creativecommons.org/licenses/by/4.0/
https://doaj.org/toc/0197-6729,
https://doaj.org/toc/2042-3195
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Published on 01/01/2018

Volume 2018, 2018
DOI: 10.1155/2018/2153536
Licence: Other

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