Builders FirstSourceMEX:BLDR 72 WACC % is 6.88% as of Jun. 28, 2026, which is 44% below its 10-year median of 12.34. GuruFocus rates MEX:BLDR with a GF Score™ of 72/100 and a GF Value™ of MXN2,069.38 (Significantly Undervalued). The stock has 8 warning signs investors should review. Among 1,804 Construction companies, Builders FirstSource ranks worse than 80.99% on this metric.
As of today (2026-06-28), Builders FirstSource's weighted average cost of capital is 6.88%%. Builders FirstSource's ROIC % is 5.45% (calculated using TTM income statement data).
Builders FirstSource 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.
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, Builders FirstSource's weighted average cost of capital is 6.88%%. Builders FirstSource's ROIC % is 5.45% (calculated using TTM income statement data).
Builders FirstSource 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 Building Products & Equipment subindustry, Builders FirstSource'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.
Builders FirstSource WACC % vs Construction Industry
For the Construction industry and Industrials sector, Builders FirstSource's WACC % distribution charts can be found below:
* The bar in red indicates where Builders FirstSource'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, Builders FirstSource's market capitalization (E) is MXN167963.583 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, Builders FirstSource's latest one-year quarterly average Book Value of Debt (D) is MXN97012.9712 Mil.
a) weight of equity = E / (E + D) = 167963.583 / (167963.583 + 97012.9712) = 0.6339
b) weight of debt = D / (E + D) = 97012.9712 / (167963.583 + 97012.9712) = 0.3661
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 4.376%. 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. Builders FirstSource's beta is 0.6342.
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 = 4.376% + 0.6342 * 6% = 8.1812%
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, Builders FirstSource's interest expense (positive number) was MXN5187.424 Mil. Its total Book Value of Debt (D) is MXN97012.9712 Mil.
Cost of Debt = 5187.424 / 97012.9712 = 5.3471%.
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 = 839.809 / 6280.647 = 13.37%.
Builders FirstSource's Weighted Average Cost Of Capital (WACC) for Today is calculated as:
WACC
=
E / (E + D)
*
Cost of Equity
+
D / (E + D)
*
Cost of Debt
*
(1 - Tax Rate)
=
0.6339
*
8.1812%
+
0.3661
*
5.3471%
*
(1 - 13.37%)
=
6.88%
* 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.
Builders FirstSource (MEX:BLDR) has a WACC % of 6.88% as of Jun. 28, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Builders FirstSource and its competitors. This is 44% below median its historical median of 12.34. Over the past decade, Builders FirstSource's WACC % has ranged from 9.10 to 14.18. According to the industry distribution chart, Builders FirstSource ranks #1461 out of 1804 companies in the Construction industry, placing it in the top 81%.
Is Builders FirstSource's WACC % too high?
Builders FirstSource's current WACC % of 6.88% is 44% below median its 10-year median of 12.34. Over the past 10 years, this metric has ranged from a low of 9.10 to a high of 14.18. The Construction industry median WACC % is 7.68. Builders FirstSource's value of 6.88% is 10.4% below this industry median. Based on the distribution chart, Builders FirstSource ranks #1461 out of 1804 companies in the Construction industry, which is in the bottom quartile relative to peers. Overall, Builders FirstSource has a GF Score™ of 72/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Builders FirstSource's WACC % compare to AWI and OC?
According to the Construction industry distribution chart, Builders FirstSource ranks #1461 out of 1804 companies for WACC %. This places Builders FirstSource in the lower half of its industry. The industry median WACC % is 7.68. Builders FirstSource's value of 6.88% is 10.4% below this benchmark. Historically, Builders FirstSource's own WACC % has ranged from 9.10 to 14.18 over the past decade. While the company's 10-year median is 12.34 vs. the industry median of 7.68, Builders FirstSource has consistently been below 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 Construction company?
The median WACC % among Construction companies is 7.68, based on 1,804 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. Builders FirstSource's current WACC % of 6.88% is 10.4% below 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 Builders FirstSource and its competitors. For the Construction industry, the median WACC % is 7.68 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Builders FirstSource's current WACC % is 6.88%, which is 44% below median its own 10-year median of 12.34. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Builders FirstSource stock overvalued right now?
Based on GuruFocus' analysis, Builders FirstSource (MEX:BLDR) is currently considered Significantly Undervalued. The stock's GF Value™ is MXN2,069.38, compared to a current price of MXN1,380.00 — trading 33.3% below its estimated fair value. The current WACC % is 6.88%, which is 44% below median its 10-year median of 12.34 and 10.4% below the Construction industry median of 7.68. Builders FirstSource's overall GF Score™ is 72/100 with 8 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 Builders FirstSource (MEX:BLDR), the current WACC % is 6.88% as of Jun. 28, 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 Builders FirstSource (MEX:BLDR) Overvalued in 2026?
Based on GuruFocus' analysis, Builders FirstSource stock appears to be undervalued.
The current stock price of MXN1,380.00 is trading 33.3% below its estimated GF Value™ of MXN2,069.38.
GuruFocus considers Builders FirstSource to be Significantly Undervalued.
Key valuation signals for MEX:BLDR:
WACC %: 6.88% (44% below median its 10-year median of 12.34)
GF Value™: MXN2,069.38 vs. price of MXN1,380.00 (33.3% below fair value)
Industry Position: 10.4% below the Construction median (#1461 of 1804)
No single metric tells the full story. See the MEX:BLDR stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Builders FirstSource Inc is a manufacturer and supplier of building materials. The company offers structural and related building products such as factory-built roof and floor trusses, wall panels and stairs, vinyl windows, custom millwork and trim, and engineered wood. The products can be designed for each home individually and are installed by Builders FirstSource. The company's construction-related services include professional installation, turn-key framing, and shell construction. Builders FirstSource's customers range from large production builders to small custom homebuilders.
72GF Score
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