The cost of equity and the cost of capital are key metrics in corporate finance that influence financial strategy and investment decisions. The cost of equity reflects the return shareholders ...

Ownership Stake: Equity shareholders have a stake in the company's assets and profits. Voting Rights: Shareholders can vote on major corporate decisions, such as electing board members.

When to use debt and when to raise equity Generally speaking, most companies will choose to raise debt financing if it has the cash flow, the assets, and the ability to repay the debts.