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Thermo Fisher Scientific, Inc. (TMO) — WACC Analysis

WACC Breakdown

Thermo Fisher Scientific, Inc. (TMO) has a weighted average cost of capital (WACC) of 7.7%. The cost of equity is 8.5%, derived from a beta of 0.84 and a risk-free rate of 4.7%. The after-tax cost of debt is 3.0%. The capital structure is 85.6% equity and 14.4% debt.

Interpretation

A WACC of 7.7% suggests that the market views Thermo Fisher Scientific, Inc. as relatively low-risk, with a lower cost of financing.

Investors can compare TMO's WACC of 7.7% against industry peers to gauge its relative financing costs. A beta of 0.84 reflects the stock's volatility relative to the broader market.

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VALUATION

TMO WACC: 7.72% for Thermo Fisher Scientific, Inc.

Current inputs imply a 8.52% cost of equity and a 3.74% 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

Thermo Fisher Scientific, Inc. Common Stock (TMO) WACC Results
Weighted Average Cost of Capital
7.72%
Cost of Equity
8.52%
Risk-Free Rate4.74%
Beta0.84
Market Risk Premium4.23%
Cost of Debt
2.96%
Pre-Tax Cost of Debt3.74%
Tax Rate21.00%
Tax Shield0.79%
Capital Structure
Equity: 85.59%($232.67B)
Debt: 14.41%($39.18B)
Equity Component
7.29%
85.59% × 8.52%
Debt Component
0.43%
14.41% × 2.96%

Thermo Fisher Scientific, Inc. (TMO) WACC in context

Thermo Fisher Scientific, Inc. (TMO) currently screens with an estimated WACC of 7.72%. That blends a 8.52% cost of equity, a 3.74% pre-tax cost of debt, and a 85.59% 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 TMO WACC implies

A 7.72% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates TMO

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.84 and equity accounts for 85.59% 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.