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Duff and Phelps Risk Premium Report and Risk Premium Calculator

Duff and Phelps Risk Premium Report and Risk Premium Calculator

The Duff and Phelps Risk Premium Report is an invaluable resource for developing equity risk premiums for small companies. The Risk Premium Report PLUS the Risk Premium Calculator is now available from ValuSource. The data can be used by both Excel users and ValuSource software users, including ValuSource Pro, Business Valuation Manager Pro and Express Business Valuation. The Risk Premium Report is gaining in popularity among valuators and you can no longer afford to ignore this approach to developing equity risk premiums.

Download Free Report Excerpt Compare Database
Download Free Calculator Report

Risk Premium Report Overview

A premium resource for determining discount rates, the Risk Premium Report provides equity risk premiums for companies sized by eight different criteria:

  • Market capitalization
  • Book value
  • Net income
  • Market Value of Invested Capital
  • Total assets
  • EBITDA
  • Sales
  • Number of employees

The underlying data for the Risk Premium Report is drawn from both the CSRP and Compustat databases, covering 47 years (1963 – 2010) years of financial reports from companies listed on the New York Stock Exchange, the NASDAQ and the AMEX.

The Risk Premium Report (originally the Standard & Poor's Corporate Value Consulting Equity Risk Premium Report) is produced annually by Duff and Phelps LLC, a leading provider of independent financial advisory and investment banking services. The Report is authored by Roger Grabowski, a managing director of Duff & Phelps.

In selecting the data for their analysis, the authors have segregated high risk companies into a separate “portfolio” and de-selected companies de-listed from their exchanges and other companies whose data would tend to skew the risk premium curve (companies with 5 year negative EBITDA, companies with less than 5 years reported data, etc.). The remaining companies are then divided into 25 “portfolios” based on size, using eight alternate measures for size.

Pricing:

$499.00         Calculator Option 1
This is a one year subscription to access both the Risk Premium Report PDF’s and the Risk Premium Calculator (unlimited access). You will have access to all the PDF’s from 1996 to the present year and the calculator provides the data from those years as well. The PDF’s and calculator will allow you to estimate the cost of equity capital for any valuation date from January 1, 1996 to the present.
$275.00         Calculator Option 2
Includes the current Duff and Phelps Risk Premium Report PDF and one (1) access to the Duff & Phelps Risk Premium Calculator.

Risk Premium Calculator Overview

Download Free Calculator Report

The web-based Risk Premium Calculator (the same sold by BV Resources) is both easy to use and will save the appraiser time in calculating cost of equity (COE) for the subject company of a valuation. Based on the subject company’s size and risk characteristics, the Risk Premium Calculator will:

  • Automatically estimate levered and unlevered cost of equity
  • Automatically makes an Equity Risk Premium (ERP) adjustment to account for differences between ERP as of valuation date and market risk premium used to calculate the risk premiums published in the Risk Premium Report
  • Automatically generates an Executive Summary of COE estimates in Word, including CAPM, Buildup and unlevered COE, which includes Excel output of the values and calculations

Works with these software products

System Requirements and Compatibility:

Web-Based Product System Requirements & Compatibility

Requires web browser (IE7+ or FireFox 3.5+) and Microsoft® Excel or Excel-compatible spreadsheet.

CD Product System Requirements & Compatibility

This product is only web-based

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