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