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Bristol-Myers Squibb Co. (BMY) — WACC Analysis

WACC Breakdown

Bristol-Myers Squibb Co. (BMY) has a weighted average cost of capital (WACC) of 6.0%. The cost of equity is 6.9%, derived from a beta of 0.28 and a risk-free rate of 4.7%. The after-tax cost of debt is 3.2%. The capital structure is 76.0% equity and 24.0% debt.

Interpretation

A WACC of 6.0% suggests that the market views Bristol-Myers Squibb Co. as relatively low-risk, with a lower cost of financing.

Investors can compare BMY's WACC of 6.0% against industry peers to gauge its relative financing costs. A beta of 0.28 reflects the stock's volatility relative to the broader market.

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VALUATION

BMY WACC: 6.03% for Bristol-Myers Squibb Co.

Current inputs imply a 6.93% cost of equity and a 4.01% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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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

Bristol-Myers Squibb Co. Common Stock (BMY) WACC Results
Weighted Average Cost of Capital
6.03%
Cost of Equity
6.93%
Risk-Free Rate4.73%
Beta0.28
Market Risk Premium4.23%
Cost of Debt
3.17%
Pre-Tax Cost of Debt4.01%
Tax Rate21.00%
Tax Shield0.84%
Capital Structure
Equity: 75.99%($136.47B)
Debt: 24.01%($43.12B)
Equity Component
5.27%
75.99% × 6.93%
Debt Component
0.76%
24.01% × 3.17%

Bristol-Myers Squibb Co. (BMY) WACC in context

Bristol-Myers Squibb Co. (BMY) currently screens with an estimated WACC of 6.03%. That blends a 6.93% cost of equity, a 4.01% pre-tax cost of debt, and a 75.99% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What BMY WACC implies

A 6.03% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates BMY

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.28 and equity accounts for 75.99% 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.