Sector WACC Adjustments

Use these typical WACC ranges as starting points, then adjust based on company-specific factors.

Determining Company Sector

Use get_financials with query "[TICKER] company facts" to retrieve the company's sector. Match the returned sector to the table below.

WACC by Sector

Sector	Typical WACC Range	Notes
Communication Services	8-10%	Mix of stable telecom and growth media
Consumer Discretionary	8-10%	Cyclical exposure
Consumer Staples	7-8%	Defensive, stable demand
Energy	9-11%	Commodity price exposure
Financials	8-10%	Leverage already in business model
Health Care	8-10%	Regulatory and pipeline risk
Industrials	8-9%	Moderate cyclicality
Information Technology	8-12%	Assess growth stage; higher for high-growth
Materials	8-10%	Cyclical, commodity exposure
Real Estate	7-9%	Interest rate sensitivity
Utilities	6-7%	Regulated, stable cash flows

Adjustment Factors

Add to base WACC:

• High debt (D/E > 1.5): +1-2%
• Small cap (< $2B market cap): +1-2%
• Emerging markets exposure: +1-3%
• Concentrated customer base: +0.5-1%
• Regulatory uncertainty: +0.5-1.5%

Subtract from base WACC:

• Market leader with moat: -0.5-1%
• Recurring revenue model: -0.5-1%
• Investment grade credit rating: -0.5%

Reasonableness Checks

• WACC should typically be 2-4% below ROIC for value-creating companies
• If calculated WACC > ROIC, the company may be destroying value
• Compare to sector peers if available