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Huntington Ingalls Industries, Inc. (HII) — WACC Analysis

WACC Breakdown

Huntington Ingalls Industries, Inc. (HII) has a weighted average cost of capital (WACC) of 6.8%. The cost of equity is 7.8%, derived from a beta of 0.58 and a risk-free rate of 4.7%. The after-tax cost of debt is 2.9%. The capital structure is 80.9% equity and 19.1% debt.

Interpretation

A WACC of 6.8% suggests that the market views Huntington Ingalls Industries, Inc. as relatively low-risk, with a lower cost of financing.

Investors can compare HII's WACC of 6.8% against industry peers to gauge its relative financing costs. A beta of 0.58 reflects the stock's volatility relative to the broader market.

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VALUATION

HII WACC: 6.84% for Huntington Ingalls Industries, Inc.

Current inputs imply a 7.78% cost of equity and a 3.63% 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

Huntington Ingalls Industries, Inc. Common Stock (HII) WACC Results
Weighted Average Cost of Capital
6.84%
Cost of Equity
7.78%
Risk-Free Rate4.73%
Beta0.58
Market Risk Premium4.23%
Cost of Debt
2.87%
Pre-Tax Cost of Debt3.63%
Tax Rate21.00%
Tax Shield0.76%
Capital Structure
Equity: 80.94%($11.47B)
Debt: 19.06%($2702.00M)
Equity Component
6.29%
80.94% × 7.78%
Debt Component
0.55%
19.06% × 2.87%

Huntington Ingalls Industries, Inc. (HII) WACC in context

Huntington Ingalls Industries, Inc. (HII) currently screens with an estimated WACC of 6.84%. That blends a 7.78% cost of equity, a 3.63% pre-tax cost of debt, and a 80.94% 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 HII WACC implies

A 6.84% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates HII

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.58 and equity accounts for 80.94% 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.