Question 1

What is Chicago Rivet & Machine Co.'s WACC?

Accepted Answer

Chicago Rivet & Machine Co. (CVR) has a Weighted Average Cost of Capital (WACC) of 6.43%. This is calculated using a Cost of Equity of 6.90% (via CAPM with a beta of 0.37) and a pre-tax Cost of Debt of 2.00%, with an equity weight of 90.29% in the capital structure.

Question 2

Is Chicago Rivet & Machine Co.'s WACC high or low?

Accepted Answer

Chicago Rivet & Machine Co.'s WACC of 6.43% 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 Chicago Rivet & Machine Co.'s WACC calculated?

Accepted Answer

Chicago Rivet & Machine Co.'s WACC is calculated using the formula: WACC = (E/V × Re) + (D/V × Rd × (1-T)). The Cost of Equity (Re) of 6.90% is derived from the CAPM model using a beta of 0.37. The pre-tax Cost of Debt (Rd) is 2.00%. The capital structure is 90.29% equity and 9.71% debt.

Chicago Rivet & Machine Co. (CVR) — WACC 分析

WACC 构成

解读

Chicago Rivet & Machine Co.（CVR）WACC：6.43%

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Chicago Rivet & Machine Co.（CVR） WACC 解读

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