Question 1

What is Essential Utilities, Inc.'s WACC?

Accepted Answer

Essential Utilities, Inc. (WTRG) has a Weighted Average Cost of Capital (WACC) of 5.25%. This is calculated using a Cost of Equity of 6.91% (via CAPM with a beta of 0.36) and a pre-tax Cost of Debt of 3.99%, with an equity weight of 55.95% in the capital structure.

Question 2

Is Essential Utilities, Inc.'s WACC high or low?

Accepted Answer

Essential Utilities, Inc.'s WACC of 5.25% 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 Essential Utilities, Inc.'s WACC calculated?

Accepted Answer

Essential Utilities, Inc.'s WACC is calculated using the formula: WACC = (E/V × Re) + (D/V × Rd × (1-T)). The Cost of Equity (Re) of 6.91% is derived from the CAPM model using a beta of 0.36. The pre-tax Cost of Debt (Rd) is 3.99%. The capital structure is 55.95% equity and 44.05% debt.

Essential Utilities, Inc. (WTRG) — WACC 分析

WACC 构成

解读

Essential Utilities, Inc.（WTRG）WACC：5.25%

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Essential Utilities, Inc.（WTRG） WACC 解读

WTRG 公司分析

WTRG DCF 估值

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