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Dream Finders Homes, Inc. (DFH) — WACC Analysis

WACC Breakdown

Dream Finders Homes, Inc. (DFH) has a weighted average cost of capital (WACC) of 4.3%. The cost of equity is 10.2%, derived from a beta of 1.26 and a risk-free rate of 5.2%. The after-tax cost of debt is 1.6%. The capital structure is 31.8% equity and 68.2% debt.

Interpretation

A WACC of 4.3% suggests that the market views Dream Finders Homes, Inc. as relatively low-risk, with a lower cost of financing.

Investors can compare DFH's WACC of 4.3% against industry peers to gauge its relative financing costs. A beta of 1.26 reflects the stock's volatility relative to the broader market.

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VALUATION

DFH WACC: 4.32% for Dream Finders Homes, Inc.

Current inputs imply a 10.18% cost of equity and a 2.00% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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[02]
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

Dream Finders Homes, Inc. Common Stock (DFH) WACC Results
Weighted Average Cost of Capital
4.32%
Cost of Equity
10.18%
Risk-Free Rate5.22%
Beta1.26
Market Risk Premium4.23%
Cost of Debt
1.58%
Pre-Tax Cost of Debt2.00%
Tax Rate21.00%
Tax Shield0.42%
Capital Structure
Equity: 31.85%($849.22M)
Debt: 68.15%($1817.11M)
Equity Component
3.24%
31.85% × 10.18%
Debt Component
1.08%
68.15% × 1.58%

Dream Finders Homes, Inc. (DFH) WACC in context

Dream Finders Homes, Inc. (DFH) currently screens with an estimated WACC of 4.32%. That blends a 10.18% cost of equity, a 2.00% pre-tax cost of debt, and a 31.85% 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 DFH WACC implies

A 4.32% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates DFH

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.26 and equity accounts for 31.85% 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.