The WACC of Southwest Airlines Co (LUV) is 6.6%.
Range | Selected | |
Cost of equity | 6.80% - 8.80% | 7.80% |
Tax rate | 26.10% - 26.40% | 26.25% |
Cost of debt | 4.20% - 7.00% | 5.60% |
WACC | 5.6% - 7.6% | 6.6% |
Category | Low | High |
Long-term bond rate | 3.9% | 4.4% |
Equity market risk premium | 4.6% | 5.6% |
Adjusted beta | 0.63 | 0.7 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.80% | 8.80% |
Tax rate | 26.10% | 26.40% |
Debt/Equity ratio | 0.46 | 0.46 |
Cost of debt | 4.20% | 7.00% |
After-tax WACC | 5.6% | 7.6% |
Selected WACC | 6.6% | |