Question 1

What is NewMarket Corporation's WACC?

Accepted Answer

NewMarket Corporation (NEU) has a Weighted Average Cost of Capital (WACC) of 7.07%. This is calculated using a Cost of Equity of 7.55% (via CAPM with a beta of 0.59) and a pre-tax Cost of Debt of 4.02%, with an equity weight of 88.86% in the capital structure.

Question 2

Is NewMarket Corporation's WACC high or low?

Accepted Answer

NewMarket Corporation's WACC of 7.07% 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 NewMarket Corporation's WACC calculated?

Accepted Answer

NewMarket Corporation's WACC is calculated using the formula: WACC = (E/V × Re) + (D/V × Rd × (1-T)). The Cost of Equity (Re) of 7.55% is derived from the CAPM model using a beta of 0.59. The pre-tax Cost of Debt (Rd) is 4.02%. The capital structure is 88.86% equity and 11.14% debt.

NewMarket Corporation (NEU) — WACC 分析

WACC 构成

解读

NewMarket Corporation（NEU）WACC：7.07%

WACC计算器

NewMarket Corporation（NEU） WACC 解读

NEU 公司分析

NEU DCF 估值

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