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Northwest Natural Holding Company (NWN) — WACC Analysis

WACC Breakdown

Northwest Natural Holding Company (NWN) has a weighted average cost of capital (WACC) of 4.2%. The cost of equity is 7.4%, derived from a beta of 0.28 and a risk-free rate of 5.2%. The after-tax cost of debt is 1.6%. The capital structure is 45.0% equity and 55.0% debt.

Interpretation

A WACC of 4.2% suggests that the market views Northwest Natural Holding Company as relatively low-risk, with a lower cost of financing.

Investors can compare NWN's WACC of 4.2% against industry peers to gauge its relative financing costs. A beta of 0.28 reflects the stock's volatility relative to the broader market.

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VALUATION

NWN WACC: 4.21% for Northwest Natural Holding Company

Current inputs imply a 7.42% cost of equity and a 2.00% 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

Northwest Natural Holding Company Common Stock (NWN) WACC Results
Weighted Average Cost of Capital
4.21%
Cost of Equity
7.42%
Risk-Free Rate5.22%
Beta0.28
Market Risk Premium4.23%
Cost of Debt
1.58%
Pre-Tax Cost of Debt2.00%
Tax Rate21.00%
Tax Shield0.42%
Capital Structure
Equity: 44.95%($2039.85M)
Debt: 55.05%($2497.97M)
Equity Component
3.34%
44.95% × 7.42%
Debt Component
0.87%
55.05% × 1.58%

Northwest Natural Holding Company (NWN) WACC in context

Northwest Natural Holding Company (NWN) currently screens with an estimated WACC of 4.21%. That blends a 7.42% cost of equity, a 2.00% pre-tax cost of debt, and a 44.95% 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 NWN WACC implies

A 4.21% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates NWN

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.28 and equity accounts for 44.95% 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.