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Goodyear Tire & Rubber (GT) — WACC Analysis

WACC Breakdown

Goodyear Tire & Rubber (GT) has a weighted average cost of capital (WACC) of 6.8%. The cost of equity is 10.5%, derived from a beta of 1.44 and a risk-free rate of 5.0%. The after-tax cost of debt is 6.1%. The capital structure is 15.7% equity and 84.3% debt.

Interpretation

A WACC of 6.8% suggests that the market views Goodyear Tire & Rubber as relatively low-risk, with a lower cost of financing.

Investors can compare GT's WACC of 6.8% against industry peers to gauge its relative financing costs. A beta of 1.44 reflects the stock's volatility relative to the broader market.

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VALUATION

GT WACC: 6.81% for Goodyear Tire & Rubber

Current inputs imply a 10.52% cost of equity and a 6.12% 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

Goodyear Tire & Rubber Common Stock (GT) WACC Results
Weighted Average Cost of Capital
6.81%
Cost of Equity
10.52%
Risk-Free Rate5.05%
Beta1.44
Market Risk Premium4.23%
Cost of Debt
6.12%
Pre-Tax Cost of Debt6.12%
Tax Rate0.00%
Tax Shield0.00%
Capital Structure
Equity: 15.73%($1275.39M)
Debt: 84.27%($6831.00M)
Equity Component
1.66%
15.73% × 10.52%
Debt Component
5.16%
84.27% × 6.12%

Goodyear Tire & Rubber (GT) WACC in context

Goodyear Tire & Rubber (GT) currently screens with an estimated WACC of 6.81%. That blends a 10.52% cost of equity, a 6.12% pre-tax cost of debt, and a 15.73% 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 GT WACC implies

A 6.81% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates GT

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.44 and equity accounts for 15.73% 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.