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PENN Entertainment, Inc. Common Stock (PENN) — WACC Analysis

WACC Breakdown

PENN Entertainment, Inc. Common Stock (PENN) has a weighted average cost of capital (WACC) of 13.5%. The cost of equity is 10.7%, derived from a beta of 1.53 and a risk-free rate of 5.0%. The after-tax cost of debt is 15.5%. The capital structure is 42.2% equity and 57.8% debt.

Interpretation

A WACC of 13.5% indicates that the market perceives PENN Entertainment, Inc. Common Stock as higher-risk, requiring a greater return to compensate investors.

Investors can compare PENN's WACC of 13.5% against industry peers to gauge its relative financing costs. A beta of 1.53 reflects the stock's volatility relative to the broader market.

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VALUATION

PENN WACC: 13.46% for PENN Entertainment, Inc. Common Stock

Current inputs imply a 10.70% cost of equity and a 15.48% 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

PENN Entertainment, Inc. Common Stock Common Stock (PENN) WACC Results
Weighted Average Cost of Capital
13.46%
Cost of Equity
10.70%
Risk-Free Rate4.98%
Beta1.53
Market Risk Premium4.23%
Cost of Debt
15.48%
Pre-Tax Cost of Debt15.48%
Tax Rate0.00%
Tax Shield0.00%
Capital Structure
Equity: 42.20%($2055.24M)
Debt: 57.80%($2814.70M)
Equity Component
4.52%
42.20% × 10.70%
Debt Component
8.95%
57.80% × 15.48%

PENN Entertainment, Inc. Common Stock (PENN) WACC in context

PENN Entertainment, Inc. Common Stock (PENN) currently screens with an estimated WACC of 13.46%. That blends a 10.70% cost of equity, a 15.48% pre-tax cost of debt, and a 42.20% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

What PENN WACC implies

A 13.46% discount rate screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

How this page calculates PENN

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.53 and equity accounts for 42.20% 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.