FIX WACC - Weighted Average Cost of Capital
The WACC of Comfort Systems USA Inc (FIX) is 10.2%.
| Range | Selected | |
| Cost of equity | 8.7% - 11.7% | 10.2% |
| Tax rate | 19.6% - 21.6% | 20.6% |
| Cost of debt | 4.5% - 6.1% | 5.3% |
| WACC | 8.7% - 11.6% | 10.2% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 1.05 | 1.21 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.7% | 11.7% |
| Tax rate | 19.6% | 21.6% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 4.5% | 6.1% |
| After-tax WACC | 8.7% | 11.6% |
| Selected WACC | 10.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| FIX | Comfort Systems USA Inc | 0 | 2.18 | 2.17 |
| AEGN | Aegion Corp | 0.24 | 1.31 | 1.1 |
| AMRC | Ameresco Inc | 2.05 | 1.3 | 0.5 |
| ARE.TO | Aecon Group Inc | 0.36 | 0.77 | 0.6 |
| BDT.TO | Bird Construction Inc | 0.17 | 1.94 | 1.72 |
| DY | Dycom Industries Inc | 0.13 | 1.15 | 1.04 |
| GVA | Granite Construction Inc | 0.18 | 1.01 | 0.89 |
| IEA | Infrastructure and Energy Alternatives Inc | 0.53 | 1.71 | 1.21 |
| MYRG | MYR Group Inc | 0.03 | 1.89 | 1.85 |
| PRIM | Primoris Services Corp | 0.17 | 1.91 | 1.69 |
| ROAD | Construction Partners Inc | 0.09 | 1.57 | 1.47 |
| Low | High | |
| Unlevered beta | 1.1 | 1.47 |
| Relevered beta | 1.07 | 1.31 |
| Adjusted relevered beta | 1.05 | 1.21 |
FIX'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 FIX:
cost_of_equity (10.20%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.05) + 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.