CARR
Carrier Global Corp
Price:  
65.20 
USD
Volume:  
6,863,590.00
United States | Building Products
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CARR WACC - Weighted Average Cost of Capital

The WACC of Carrier Global Corp (CARR) is 8.8%.

The Cost of Equity of Carrier Global Corp (CARR) is 10.00%.
The Cost of Debt of Carrier Global Corp (CARR) is 4.65%.

Range Selected
Cost of equity 8.80% - 11.20% 10.00%
Tax rate 27.90% - 29.40% 28.65%
Cost of debt 4.00% - 5.30% 4.65%
WACC 7.7% - 9.8% 8.8%
WACC

CARR WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.07 1.13
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.80% 11.20%
Tax rate 27.90% 29.40%
Debt/Equity ratio 0.22 0.22
Cost of debt 4.00% 5.30%
After-tax WACC 7.7% 9.8%
Selected WACC 8.8%

CARR's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for CARR:

cost_of_equity (10.00%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.07) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.