Life Time Group HoldingsLTH +2.75%82 WACC % is 9.44% as of Jun. 25, 2026, which is 65% above its 10-year median of 5.71. GuruFocus rates LTH with a GF Score™ of 82/100 and a GF Value™ of $27.88 (Significantly Overvalued). The stock has 7 warning signs investors should review. Among 870 Travel & Leisure companies, Life Time Group Holdings ranks worse than 64.48% on this metric.
As of today (2026-06-25), Life Time Group Holdings's weighted average cost of capital is 9.44%%. Life Time Group Holdings's ROIC % is 4.86% (calculated using TTM income statement data).
Life Time Group Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.
For a comprehensive WACC calculation, please access the WACC Calculator.
Life Time Group Holdings (NYSE:LTH) WACC % Explanation
Because it costs money to raise capital. A firm that generates higher ROIC % than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Life Time Group Holdings's weighted average cost of capital is 9.44%%. Life Time Group Holdings's ROIC % is 4.86% (calculated using TTM income statement data).
Life Time Group Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year quarterly average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.
For companies that report quarterly, GuruFocus combines all of the most recent year's quarterly debt data from the beginning of the year to the year-end and calculates the average.
For companies that report semi-annually, GuruFocus combines all of the most recent year's semi-annual debt data from the start of the year to the year-end and calculates the average.
For companies that report annually, GuruFocus combines the beginning and ending annual debt data from the most recent year and then calculates the average.
2. The WACC formula discussed above does not include Preferred Stock. Please adjust if preferred stock is considered.
3. (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
4. GuruFocus uses the latest TTM Interest Expense divided by the latest one-year quarterly average debt to get the simplified cost of debt.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Leisure subindustry, Life Time Group Holdings's WACC %, along with its competitors' market caps and WACC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Life Time Group Holdings WACC % vs Travel & Leisure Industry
For the Travel & Leisure industry and Consumer Cyclical sector, Life Time Group Holdings's WACC % distribution charts can be found below:
* The bar in red indicates where Life Time Group Holdings's WACC % falls into.
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of capital. Generally speaking, a company's assets are financed by debt and equity. WACC is the average of the costs of these sources of financing, each of which is weighted by its respective use in the given situation. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances.
WACC
=
E
/
(E + D)
*
Cost of Equity
+
D
/
(E + D)
*
Cost of Debt
*
(1 - Tax Rate)
1. Weights:
Generally speaking, a company's assets are financed by debt and equity. We need to calculate the weight of equity and the weight of debt.
The market value of equity (E) is also called "Market Cap". As of today, Life Time Group Holdings's market capitalization (E) is $8652.568 Mil.
The market value of debt is typically difficult to calculate, therefore, GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding the latest one-year quarterly average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Mar. 2026, Life Time Group Holdings's latest one-year quarterly average Book Value of Debt (D) is $4106.7042 Mil.
a) weight of equity = E / (E + D) = 8652.568 / (8652.568 + 4106.7042) = 0.6781
b) weight of debt = D / (E + D) = 4106.7042 / (8652.568 + 4106.7042) = 0.3219
2. Cost of Equity:
GuruFocus uses Capital Asset Pricing Model (CAPM) to calculate the required rate of return. The formula is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
a) GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate. It is updated daily. The current risk-free rate is 4.41%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default.
b) Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. Life Time Group Holdings's beta is 1.4843.
c) (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
Cost of Equity = 4.41% + 1.4843 * 6% = 13.3158%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year quarterly average debt to get the simplified cost of debt.
As of Mar. 2026, Life Time Group Holdings's interest expense (positive number) was $72.853 Mil. Its total Book Value of Debt (D) is $4106.7042 Mil.
Cost of Debt = 72.853 / 4106.7042 = 1.774%.
4. Multiply by one minus TTM Tax Rate:
GuruFocus uses the most recent TTM Tax Expense divided by the most recent TTM Pre-Tax Income to calculate the tax rate. The calculated TTM tax rate is limited to between 0% and 100%. If the calculated tax rate is higher than 100%, it is set to 100%. If the calculated tax rate is less than 0%, it is set to 0%.
The latest calculated TTM Tax Rate = 144.596 / 530.223 = 27.27%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Life Time Group Holdings (LTH) has a WACC % of 9.44% as of Jun. 25, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Life Time Group Holdings and its competitors. This is 65% above median its historical median of 5.71. Over the past decade, Life Time Group Holdings' WACC % has ranged from 2.48 to 10.99. According to the industry distribution chart, Life Time Group Holdings ranks #561 out of 870 companies in the Travel & Leisure industry, placing it in the top 64.5%.
Is Life Time Group Holdings' WACC % too high?
Life Time Group Holdings' current WACC % of 9.44% is 65% above median its 10-year median of 5.71. Over the past 10 years, this metric has ranged from a low of 2.48 to a high of 10.99. The Travel & Leisure industry median WACC % is 7.76. Life Time Group Holdings' value of 9.44% is 21.6% above this industry median. Based on the distribution chart, Life Time Group Holdings ranks #561 out of 870 companies in the Travel & Leisure industry, which is below the industry midpoint. Overall, Life Time Group Holdings has a GF Score™ of 82/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Life Time Group Holdings' WACC % compare to GOLF and MAT?
According to the Travel & Leisure industry distribution chart, Life Time Group Holdings ranks #561 out of 870 companies for WACC %. This places Life Time Group Holdings in the lower half of its industry. The industry median WACC % is 7.76. Life Time Group Holdings' value of 9.44% is 21.6% above this benchmark. Historically, Life Time Group Holdings' own WACC % has ranged from 2.48 to 10.99 over the past decade. While the company's 10-year median is 5.71 vs. the industry median of 7.76, Life Time Group Holdings has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good WACC % for a Travel & Leisure company?
The median WACC % among Travel & Leisure companies is 7.76, based on 870 companies in the industry. Companies in the top quartile (top 25%) have a WACC % significantly above this median, while those in the bottom quartile fall well below. However, WACC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Life Time Group Holdings's current WACC % of 9.44% is 21.6% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high WACC % mean?
A high WACC % can signal that a stock is expensive relative to its fundamentals. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Life Time Group Holdings and its competitors. For the Travel & Leisure industry, the median WACC % is 7.76 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Life Time Group Holdings's current WACC % is 9.44%, which is 65% above median its own 10-year median of 5.71. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Life Time Group Holdings stock overvalued right now?
Based on GuruFocus' analysis, Life Time Group Holdings (LTH) is currently considered Significantly Overvalued. The stock's GF Value™ is $27.88, compared to a current price of $38.87 — trading 39.4% above its estimated fair value. The current WACC % is 9.44%, which is 65% above median its 10-year median of 5.71 and 21.6% above the Travel & Leisure industry median of 7.76. Life Time Group Holdings' overall GF Score™ is 82/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is WACC % calculated?
WACC % is calculated from a company's financial statements. For Life Time Group Holdings (LTH), the current WACC % is 9.44% as of Jun. 25, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Life Time Group Holdings (LTH) Overvalued in 2026?
Based on GuruFocus' analysis, Life Time Group Holdings stock appears to be overvalued.
The current stock price of $38.87 is trading 39.4% above its estimated GF Value™ of $27.88.
GuruFocus considers Life Time Group Holdings to be Significantly Overvalued.
Key valuation signals for LTH:
WACC %: 9.44% (65% above median its 10-year median of 5.71)
GF Value™: $27.88 vs. price of $38.87 (39.4% above fair value)
Industry Position: 21.6% above the Travel & Leisure median (#561 of 870)
No single metric tells the full story. See the LTH stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Life Time Group Holdings Inc is a lifestyle and leisure brand offering health, fitness, and wellness experiences to a community. It is engaged in designing, building, and operating distinctive and large, multi-use sports and athletic, professional fitness, family recreation, and spa centers in a resort-like environment, principally in residential locations of metropolitan areas in the United States and Canada.
82GF Score
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