Question 1

What is Darden Restaurants, Inc.'s WACC?

Accepted Answer

Darden Restaurants, Inc. (DRI) has a Weighted Average Cost of Capital (WACC) of 7.65%. This is calculated using a Cost of Equity of 8.07% (via CAPM with a beta of 0.74) and a pre-tax Cost of Debt of 4.77%, with an equity weight of 90.34% in the capital structure.

Question 2

Is Darden Restaurants, Inc.'s WACC high or low?

Accepted Answer

Darden Restaurants, Inc.'s WACC of 7.65% 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 Darden Restaurants, Inc.'s WACC calculated?

Accepted Answer

Darden Restaurants, Inc.'s WACC is calculated using the formula: WACC = (E/V × Re) + (D/V × Rd × (1-T)). The Cost of Equity (Re) of 8.07% is derived from the CAPM model using a beta of 0.74. The pre-tax Cost of Debt (Rd) is 4.77%. The capital structure is 90.34% equity and 9.66% debt.

Darden Restaurants, Inc. (DRI) — WACC 分析

WACC 构成

解读

Darden Restaurants, Inc.（DRI）WACC：7.65%

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Darden Restaurants, Inc.（DRI） WACC 解读

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DRI DCF 估值

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