Maidenform Brands (Weighted Average Cost of Capital (WACC) Analysis)
Improve your investment analysis with by seeing the Maidenform Brands's Discounted Cash Flow analysis, Maidenform Brands's Warren Buffet analysis, and Maidenform Brands's Comparable Multiple analysis.
Helpful Information for Maidenform Brands's Analysis
What is the WACC Formula? Analyst use the WACC Discount Rate (weighted average cost of capital) to determine Maidenform Brands'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 Maidenform Brands. Value Investing Importance? This method is widely used by investment professionals to determine the correct price for investments in Maidenform Brands before they make value investing decisions. This WACC analysis is used in Maidenform Brands's discounted cash flow (DCF) valuation and see how the WACC calculation affect's Maidenform Brands's company valuation.
WACC Analysis Information
1. The WACC (discount rate) calculation for Maidenform Brands uses comparable companies to produce a single WACC (discount rate). An industry average WACC (discount rate) is the most accurate for Maidenform Brands over the long term. If there are any short-term differences between the industry WACC and Maidenform Brands's WACC (discount rate), then Maidenform Brands is more likely to revert to the industry WACC (discount rate) over the long term.
2. The WACC calculation uses the higher of Maidenform Brands'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 Maidenform Brands uses a significant proportion of equity capital.