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