National Bank of Greece - WACC Analysis

National Bank of Greece (Weighted Average Cost of Capital (WACC) Analysis)



Helpful Information for National Bank of Greece's Analysis

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

WACC Analysis Information

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

2. The WACC calculation uses the higher of National Bank of Greece'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 Bank of Greece uses a significant proportion of equity capital.