Rogers Comm - WACC Analysis

Rogers Comm (Weighted Average Cost of Capital (WACC) Analysis)



Helpful Information for Rogers Comm's Analysis

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

WACC Analysis Information

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

2. The WACC calculation uses the higher of Rogers Comm'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 Rogers Comm uses a significant proportion of equity capital.