Skip to content

Best Buy Company, Inc. (BBY) — WACC Analysis

WACC Breakdown

Best Buy Company, Inc. (BBY) has a weighted average cost of capital (WACC) of 8.8%. The cost of equity is 9.2%, derived from a beta of 1.09 and a risk-free rate of 4.7%. The after-tax cost of debt is 3.1%. The capital structure is 93.7% equity and 6.3% debt.

Interpretation

A WACC of 8.8% is moderate, reflecting the market's balanced risk assessment of Best Buy Company, Inc..

Investors can compare BBY's WACC of 8.8% against industry peers to gauge its relative financing costs. A beta of 1.09 reflects the stock's volatility relative to the broader market.

DeepViews
VALUATION

BBY WACC: 8.83% for Best Buy Company, Inc.

Current inputs imply a 9.21% cost of equity and a 3.93% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
Loading market data...
[02]
WACC Calculation Process
1
Market Data Loaded
2
Company Data Fetched
3
Beta Calculated (5Y)
4
Inputs Auto-Populated
5
WACC Calculated
[03]
Step 2: Enter Ticker Symbol
Quick search:
Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

Best Buy Company, Inc. Common Stock (BBY) WACC Results
Weighted Average Cost of Capital
8.83%
Cost of Equity
9.21%
Risk-Free Rate4.73%
Beta1.09
Market Risk Premium4.23%
Cost of Debt
3.11%
Pre-Tax Cost of Debt3.93%
Tax Rate21.00%
Tax Shield0.83%
Capital Structure
Equity: 93.70%($17.38B)
Debt: 6.30%($1169.00M)
Equity Component
8.63%
93.70% × 9.21%
Debt Component
0.20%
6.30% × 3.11%

Best Buy Company, Inc. (BBY) WACC in context

Best Buy Company, Inc. (BBY) currently screens with an estimated WACC of 8.83%. That blends a 9.21% cost of equity, a 3.93% pre-tax cost of debt, and a 93.70% equity weight into the discount rate you would typically use in a DCF model.

falls into a common range for established public companies and is a practical DCF starting point.

What BBY WACC implies

A 8.83% discount rate falls into a common range for established public companies and is a practical DCF starting point.

How this page calculates BBY

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.09 and equity accounts for 93.70% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.