Question 1

What is TopBuild Corp. Common Stock's WACC?

Accepted Answer

TopBuild Corp. Common Stock (BLD) has a Weighted Average Cost of Capital (WACC) of 7.68%. This is calculated using a Cost of Equity of 8.71% (via CAPM with a beta of 1.00) and a pre-tax Cost of Debt of 4.37%, with an equity weight of 80.37% in the capital structure.

Question 2

Is TopBuild Corp. Common Stock's WACC high or low?

Accepted Answer

TopBuild Corp. Common Stock's WACC of 7.68% is below the typical range of 8-12% for most companies, indicating relatively low cost of capital and lower risk. WACC is used as the discount rate in DCF valuations — a lower WACC results in higher present values of future cash flows.

Question 3

How is TopBuild Corp. Common Stock's WACC calculated?

Accepted Answer

TopBuild Corp. Common Stock's WACC is calculated using the formula: WACC = (E/V × Re) + (D/V × Rd × (1-T)). The Cost of Equity (Re) of 8.71% is derived from the CAPM model using a beta of 1.00. The pre-tax Cost of Debt (Rd) is 4.37%. The capital structure is 80.37% equity and 19.63% debt.

TopBuild Corp. Common Stock (BLD) — WACC 分析

WACC 构成

解读

TopBuild Corp. Common Stock（BLD）WACC：7.68%

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TopBuild Corp. Common Stock（BLD） WACC 解读

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