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Lennox International Inc. (LII) — WACC Analysis

WACC Breakdown

Lennox International Inc. (LII) has a weighted average cost of capital (WACC) of 8.9%. The cost of equity is 9.6%, derived from a beta of 1.11 and a risk-free rate of 5.1%. The after-tax cost of debt is 2.6%. The capital structure is 89.1% equity and 10.9% debt.

Interpretation

A WACC of 8.9% is moderate, reflecting the market's balanced risk assessment of Lennox International Inc..

Investors can compare LII's WACC of 8.9% against industry peers to gauge its relative financing costs. A beta of 1.11 reflects the stock's volatility relative to the broader market.

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VALUATION

LII WACC: 8.87% for Lennox International Inc.

Current inputs imply a 9.64% cost of equity and a 3.28% 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

Lennox International Inc. Common Stock (LII) WACC Results
Weighted Average Cost of Capital
8.87%
Cost of Equity
9.64%
Risk-Free Rate5.10%
Beta1.11
Market Risk Premium4.23%
Cost of Debt
2.59%
Pre-Tax Cost of Debt3.28%
Tax Rate21.00%
Tax Shield0.69%
Capital Structure
Equity: 89.05%($12.39B)
Debt: 10.95%($1523.30M)
Equity Component
8.58%
89.05% × 9.64%
Debt Component
0.28%
10.95% × 2.59%

Lennox International Inc. (LII) WACC in context

Lennox International Inc. (LII) currently screens with an estimated WACC of 8.87%. That blends a 9.64% cost of equity, a 3.28% pre-tax cost of debt, and a 89.05% 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 LII WACC implies

A 8.87% discount rate falls into a common range for established public companies and is a practical DCF starting point.

How this page calculates LII

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.11 and equity accounts for 89.05% 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.