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Comtech Telecommunications (CMTL) — WACC Analysis

WACC Breakdown

Comtech Telecommunications (CMTL) has a weighted average cost of capital (WACC) of 20.0%. The cost of equity is 10.5%, derived from a beta of 1.36 and a risk-free rate of 5.2%. The after-tax cost of debt is 43.0%. The capital structure is 24.6% equity and 75.4% debt.

Interpretation

A WACC of 20.0% indicates that the market perceives Comtech Telecommunications as higher-risk, requiring a greater return to compensate investors.

Investors can compare CMTL's WACC of 20.0% against industry peers to gauge its relative financing costs. A beta of 1.36 reflects the stock's volatility relative to the broader market.

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VALUATION

CMTL WACC: 20.00% for Comtech Telecommunications

Current inputs imply a 10.47% cost of equity and a 42.97% 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

Comtech Telecommunications Common Stock (CMTL) WACC Results
Weighted Average Cost of Capital
20.00%
Cost of Equity
10.47%
Risk-Free Rate5.22%
Beta1.36
Market Risk Premium4.23%
Cost of Debt
42.97%
Pre-Tax Cost of Debt42.97%
Tax Rate0.00%
Tax Shield0.00%
Capital Structure
Equity: 24.62%($35.35M)
Debt: 75.38%($108.24M)
Equity Component
2.58%
24.62% × 10.47%
Debt Component
32.39%
75.38% × 42.97%

Comtech Telecommunications (CMTL) WACC in context

Comtech Telecommunications (CMTL) currently screens with an estimated WACC of 20.00%. That blends a 10.47% cost of equity, a 42.97% pre-tax cost of debt, and a 24.62% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

What CMTL WACC implies

A 20.00% discount rate screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

How this page calculates CMTL

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.36 and equity accounts for 24.62% 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.