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O'Reilly Automotive, Inc. (ORLY) — WACC Analysis

WACC Breakdown

O'Reilly Automotive, Inc. (ORLY) has a weighted average cost of capital (WACC) of 7.2%. The cost of equity is 7.6%, derived from a beta of 0.39 and a risk-free rate of 5.1%. The after-tax cost of debt is 2.8%. The capital structure is 91.1% equity and 8.9% debt.

Interpretation

A WACC of 7.2% suggests that the market views O'Reilly Automotive, Inc. as relatively low-risk, with a lower cost of financing.

Investors can compare ORLY's WACC of 7.2% against industry peers to gauge its relative financing costs. A beta of 0.39 reflects the stock's volatility relative to the broader market.

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VALUATION

ORLY WACC: 7.18% for O'Reilly Automotive, Inc.

Current inputs imply a 7.61% cost of equity and a 3.60% 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

O'Reilly Automotive, Inc. Common Stock (ORLY) WACC Results
Weighted Average Cost of Capital
7.18%
Cost of Equity
7.61%
Risk-Free Rate5.10%
Beta0.39
Market Risk Premium4.23%
Cost of Debt
2.85%
Pre-Tax Cost of Debt3.60%
Tax Rate21.00%
Tax Shield0.76%
Capital Structure
Equity: 91.08%($71.59B)
Debt: 8.92%($7014.54M)
Equity Component
6.93%
91.08% × 7.61%
Debt Component
0.25%
8.92% × 2.85%

O'Reilly Automotive, Inc. (ORLY) WACC in context

O'Reilly Automotive, Inc. (ORLY) currently screens with an estimated WACC of 7.18%. That blends a 7.61% cost of equity, a 3.60% pre-tax cost of debt, and a 91.08% 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 ORLY WACC implies

A 7.18% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates ORLY

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.39 and equity accounts for 91.08% 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.