National Beverage (Weighted Average Cost of Capital (WACC) Analysis)
Improve your investment analysis with by seeing the National Beverage's Discounted Cash Flow analysis, National Beverage's Warren Buffet analysis, and National Beverage's Comparable Multiple analysis.
Helpful Information for National Beverage's Analysis
What is the WACC Formula? Analyst use the WACC Discount Rate (weighted average cost of capital) to determine National Beverage's investment risk. WACC Formula = Cost of Equity (CAPM) * Common Equity + (Cost of Debt) * Total Debt. The result of this calculation is an essential input for the discounted cash flow (DCF) analysis for National Beverage. Value Investing Importance? This method is widely used by investment professionals to determine the correct price for investments in National Beverage before they make value investing decisions. This WACC analysis is used in National Beverage's discounted cash flow (DCF) valuation and see how the WACC calculation affect's National Beverage's company valuation.
WACC Analysis Information
1. The WACC (discount rate) calculation for National Beverage uses comparable companies to produce a single WACC (discount rate). An industry average WACC (discount rate) is the most accurate for National Beverage over the long term. If there are any short-term differences between the industry WACC and National Beverage's WACC (discount rate), then National Beverage is more likely to revert to the industry WACC (discount rate) over the long term.
2. The WACC calculation uses the higher of National Beverage's WACC or the risk free rate, because no investment can have a cost of capital that is better than risk free. This situation may occur if the beta is negative and National Beverage uses a significant proportion of equity capital.