Banner (Weighted Average Cost of Capital (WACC) Analysis)
 Improve your investment analysis with by seeing the Banner's Discounted Cash Flow analysis, Banner's Warren Buffet analysis, and Banner's Comparable Multiple analysis.  Helpful Information for Banner's AnalysisWhat is the WACC Formula? Analyst use the WACC Discount Rate (weighted average cost of capital) to determine Banner'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 Banner. Value Investing Importance? This method is widely used by investment professionals to determine the correct price for investments in Banner before they make value investing decisions. This WACC analysis is used in Banner's discounted cash flow (DCF) valuation and see how the WACC calculation affect's Banner's company valuation. |
WACC Analysis Information1. The WACC (discount rate) calculation for Banner uses comparable companies to produce a single WACC (discount rate). An industry average WACC (discount rate) is the most accurate for Banner over the long term. If there are any short-term differences between the industry WACC and Banner's WACC (discount rate), then Banner is more likely to revert to the industry WACC (discount rate) over the long term. 2. The WACC calculation uses the higher of Banner'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 Banner uses a significant proportion of equity capital. |
