Man Financial Global - WACC Analysis

Man Financial Global (Weighted Average Cost of Capital (WACC) Analysis)



Helpful Information for Man Financial Global's Analysis

What is the WACC Formula? Analyst use the WACC Discount Rate (weighted average cost of capital) to determine Man Financial Global'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 Man Financial Global. Value Investing Importance? This method is widely used by investment professionals to determine the correct price for investments in Man Financial Global before they make value investing decisions. This WACC analysis is used in Man Financial Global's discounted cash flow (DCF) valuation and see how the WACC calculation affect's Man Financial Global's company valuation.

WACC Analysis Information

1. The WACC (discount rate) calculation for Man Financial Global uses comparable companies to produce a single WACC (discount rate). An industry average WACC (discount rate) is the most accurate for Man Financial Global over the long term. If there are any short-term differences between the industry WACC and Man Financial Global's WACC (discount rate), then Man Financial Global is more likely to revert to the industry WACC (discount rate) over the long term.

2. The WACC calculation uses the higher of Man Financial Global'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 Man Financial Global uses a significant proportion of equity capital.