Variables used in the regression
Model Summary^{a}


Model

R

R
Square

Adjusted
R Square

Std.
Error of the Estimate

1

.429^{b}

.184

.183

12.67747

a. Broad Group = United States


b. Predictors: (Constant), Return on
Capital (ROC or ROIC), EBITDA/EV, Expected growth in revenues  Next 2
years

Coefficients^{a,b,c}


Model

Unstandardized
Coefficients

Standardized
Coefficients

t

Sig.


B

Std.
Error

Beta


1

(Constant)

.236

.008


30.324

.000

Expected growth in revenues  Next 2
years

.023

.014

.032

1.613

.107


EBITDA/EV

.548

.071

.152

7.672

.000


Return on Capital (ROC or ROIC)

.367

.017

.398

21.034

.000


a. Broad Group = United States


b. Dependent Variable: Market Debt to
Capital Ratio


c. Weighted Least Squares Regression 
Weighted by Market Cap (in US $)

Model
Summary


Model

R

R
Square

Adjusted
R Square

Std.
Error of the Estimate

1

.472^{a}

.222

.222

10.43826

a. Predictors: (Constant), Return on
Capital (ROC or ROIC), Expected growth in revenues  Next 2 years,
EBITDA/EV

Coefficients^{a,b}


Model

Unstandardized
Coefficients

Standardized
Coefficients

t

Sig.


B

Std.
Error

Beta


1

(Constant)

.278

.003


81.203

.000

Expected growth in revenues  Next 2
years

.008

.005

.014

1.604

.109


EBITDA/EV

.396

.023

.147

16.873

.000


Return on Capital (ROC or ROIC)

.475

.009

.433

50.654

.000


a. Dependent Variable: Market Debt to
Capital Ratio


b. Weighted Least Squares Regression 
Weighted by Market Cap (in US $)

Assume that you want to estimate the market debt ratio for a firm with the following characteristics, using the US regression
EBITDA/ Enterprise Value = 8%
Pretax return on capital = 20%
Expected growth rate in revenues = 15%
Expected Debt Ratio= .236 .023 (.15) + .548 (.08) 0.367 (.20) = .203 or 20.30%
If your predicted value is less than zero, your predicted debt ratio is zero.