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INSTALLED BUILDING PRODUCTS, INC. (IBP) — WACC Analysis

WACC Breakdown

INSTALLED BUILDING PRODUCTS, INC. (IBP) has a weighted average cost of capital (WACC) of 8.9%. The cost of equity is 10.3%, derived from a beta of 1.30 and a risk-free rate of 5.2%. The after-tax cost of debt is 2.7%. The capital structure is 82.3% equity and 17.7% debt.

Interpretation

A WACC of 8.9% is moderate, reflecting the market's balanced risk assessment of INSTALLED BUILDING PRODUCTS, INC..

Investors can compare IBP's WACC of 8.9% against industry peers to gauge its relative financing costs. A beta of 1.30 reflects the stock's volatility relative to the broader market.

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VALUATION

IBP WACC: 8.94% for INSTALLED BUILDING PRODUCTS, INC.

Current inputs imply a 10.30% cost of equity and a 3.38% 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

INSTALLED BUILDING PRODUCTS, INC. Common Stock (IBP) WACC Results
Weighted Average Cost of Capital
8.94%
Cost of Equity
10.30%
Risk-Free Rate5.22%
Beta1.30
Market Risk Premium4.23%
Cost of Debt
2.67%
Pre-Tax Cost of Debt3.38%
Tax Rate21.00%
Tax Shield0.71%
Capital Structure
Equity: 82.27%($4928.84M)
Debt: 17.73%($1062.20M)
Equity Component
8.47%
82.27% × 10.30%
Debt Component
0.47%
17.73% × 2.67%

INSTALLED BUILDING PRODUCTS, INC. (IBP) WACC in context

INSTALLED BUILDING PRODUCTS, INC. (IBP) currently screens with an estimated WACC of 8.94%. That blends a 10.30% cost of equity, a 3.38% pre-tax cost of debt, and a 82.27% equity weight into the discount rate you would typically use in a DCF model.

falls into a common range for established public companies and is a practical DCF starting point.

What IBP WACC implies

A 8.94% discount rate falls into a common range for established public companies and is a practical DCF starting point.

How this page calculates IBP

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.30 and equity accounts for 82.27% 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.