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Morgan Stanley (MS) — WACC Analysis

WACC Breakdown

Morgan Stanley (MS) has a weighted average cost of capital (WACC) of 5.8%. The cost of equity is 9.4%, derived from a beta of 1.16 and a risk-free rate of 4.7%. The after-tax cost of debt is 2.7%. The capital structure is 46.8% equity and 53.2% debt.

Interpretation

A WACC of 5.8% suggests that the market views Morgan Stanley as relatively low-risk, with a lower cost of financing.

Investors can compare MS's WACC of 5.8% against industry peers to gauge its relative financing costs. A beta of 1.16 reflects the stock's volatility relative to the broader market.

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VALUATION

MS WACC: 5.82% for Morgan Stanley

Current inputs imply a 9.42% 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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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

Morgan Stanley Common Stock (MS) WACC Results
Weighted Average Cost of Capital
5.82%
Cost of Equity
9.42%
Risk-Free Rate4.74%
Beta1.16
Market Risk Premium4.23%
Cost of Debt
2.67%
Pre-Tax Cost of Debt3.38%
Tax Rate21.00%
Tax Shield0.71%
Capital Structure
Equity: 46.75%($336.42B)
Debt: 53.25%($383.16B)
Equity Component
4.40%
46.75% × 9.42%
Debt Component
1.42%
53.25% × 2.67%

Morgan Stanley (MS) WACC in context

Morgan Stanley (MS) currently screens with an estimated WACC of 5.82%. That blends a 9.42% cost of equity, a 3.38% pre-tax cost of debt, and a 46.75% 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 MS WACC implies

A 5.82% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates MS

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.16 and equity accounts for 46.75% 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.