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Pure Cycle Corporation (PCYO) — WACC Analysis

WACC Breakdown

Pure Cycle Corporation (PCYO) has a weighted average cost of capital (WACC) of 8.3%. The cost of equity is 8.6%, derived from a beta of 0.71 and a risk-free rate of 5.2%. The after-tax cost of debt is 2.8%. The capital structure is 95.0% equity and 5.0% debt.

Interpretation

A WACC of 8.3% is moderate, reflecting the market's balanced risk assessment of Pure Cycle Corporation.

Investors can compare PCYO's WACC of 8.3% against industry peers to gauge its relative financing costs. A beta of 0.71 reflects the stock's volatility relative to the broader market.

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VALUATION

PCYO WACC: 8.34% for Pure Cycle Corporation

Current inputs imply a 8.63% cost of equity and a 3.54% 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

Pure Cycle Corporation Common Stock (PCYO) WACC Results
Weighted Average Cost of Capital
8.34%
Cost of Equity
8.63%
Risk-Free Rate5.22%
Beta0.71
Market Risk Premium4.23%
Cost of Debt
2.80%
Pre-Tax Cost of Debt3.54%
Tax Rate21.00%
Tax Shield0.74%
Capital Structure
Equity: 94.99%($267.72M)
Debt: 5.01%($14.12M)
Equity Component
8.20%
94.99% × 8.63%
Debt Component
0.14%
5.01% × 2.80%

Pure Cycle Corporation (PCYO) WACC in context

Pure Cycle Corporation (PCYO) currently screens with an estimated WACC of 8.34%. That blends a 8.63% cost of equity, a 3.54% pre-tax cost of debt, and a 94.99% 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 PCYO WACC implies

A 8.34% discount rate falls into a common range for established public companies and is a practical DCF starting point.

How this page calculates PCYO

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.71 and equity accounts for 94.99% 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.