Warner Bros. DiscoveryMIL:1WBD 29 WACC % is 9.08% as of Jul. 03, 2026, which is 25% above its 10-year median of 7.24. GuruFocus rates MIL:1WBD with a GF Score™ of 29/100 and a GF Value™ of €8.66 (Significantly Overvalued). The stock has 6 warning signs investors should review. Among 1,042 Media - Diversified companies, Warner Bros. Discovery ranks worse than 74.28% on this metric.
As of today (2026-07-03), Warner Bros. Discovery's weighted average cost of capital is 9.08%%. Warner Bros. Discovery's ROIC % is 1.94% (calculated using TTM income statement data).
Warner Bros. Discovery earns returns that do not match up to its cost of capital. It will destroy value as it grows.
*Note: The beta of this company cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
For a comprehensive WACC calculation, please access the WACC Calculator.
Warner Bros. Discovery (MIL:1WBD) 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, Warner Bros. Discovery's weighted average cost of capital is 9.08%%. Warner Bros. Discovery's ROIC % is 1.94% (calculated using TTM income statement data).
Warner Bros. Discovery earns returns that do not match up to its cost of capital. It will destroy value as it grows.
*Note: The beta of this company cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
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 Entertainment subindustry, Warner Bros. Discovery'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.
Warner Bros. Discovery WACC % vs Media - Diversified Industry
For the Media - Diversified industry and Communication Services sector, Warner Bros. Discovery's WACC % distribution charts can be found below:
* The bar in red indicates where Warner Bros. Discovery'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, Warner Bros. Discovery's market capitalization (E) is €58297.292 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, Warner Bros. Discovery's latest one-year quarterly average Book Value of Debt (D) is €29820.0388 Mil.
a) weight of equity = E / (E + D) = 58297.292 / (58297.292 + 29820.0388) = 0.6616
b) weight of debt = D / (E + D) = 29820.0388 / (58297.292 + 29820.0388) = 0.3384
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 4.485%. 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. Warner Bros. Discovery's beta cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
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 = 4.485% + 1 * 6% = 10.485%
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, Warner Bros. Discovery's interest expense (positive number) was €1888.362 Mil. Its total Book Value of Debt (D) is €29820.0388 Mil.
Cost of Debt = 1888.362 / 29820.0388 = 6.3325%.
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 = 573.058 / -896.61 = -63.91%, which is less than 0%. Therefore it's set to 0%.
Warner Bros. Discovery'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)
=
0.6616
*
10.485%
+
0.3384
*
6.3325%
*
(1 - 0%)
=
9.08%
* 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.
Warner Bros. Discovery (MIL:1WBD) has a WACC % of 9.08% as of Jul. 03, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Warner Bros. Discovery and its competitors. This is 25% above median its historical median of 7.24. Over the past decade, Warner Bros. Discovery's WACC % has ranged from 5.32 to 13.15. According to the industry distribution chart, Warner Bros. Discovery ranks #774 out of 1042 companies in the Media - Diversified industry, placing it in the top 74.3%.
Is Warner Bros. Discovery's WACC % too high?
Warner Bros. Discovery's current WACC % of 9.08% is 25% above median its 10-year median of 7.24. Over the past 10 years, this metric has ranged from a low of 5.32 to a high of 13.15. The Media - Diversified industry median WACC % is 7.40. Warner Bros. Discovery's value of 9.08% is 22.8% above this industry median. Based on the distribution chart, Warner Bros. Discovery ranks #774 out of 1042 companies in the Media - Diversified industry, which is below the industry midpoint. Overall, Warner Bros. Discovery has a GF Score™ of 29/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Warner Bros. Discovery's WACC % compare to LYV and FWONA?
According to the Media - Diversified industry distribution chart, Warner Bros. Discovery ranks #774 out of 1042 companies for WACC %. This places Warner Bros. Discovery in the lower half of its industry. The industry median WACC % is 7.40. Warner Bros. Discovery's value of 9.08% is 22.8% above this benchmark. Historically, Warner Bros. Discovery's own WACC % has ranged from 5.32 to 13.15 over the past decade. While the company's 10-year median is 7.24 vs. the industry median of 7.40, Warner Bros. Discovery 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 Media - Diversified company?
The median WACC % among Media - Diversified companies is 7.40, based on 1,042 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. Warner Bros. Discovery's current WACC % of 9.08% is 22.8% 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 Warner Bros. Discovery and its competitors. For the Media - Diversified industry, the median WACC % is 7.40 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Warner Bros. Discovery's current WACC % is 9.08%, which is 25% above median its own 10-year median of 7.24. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Warner Bros. Discovery stock overvalued right now?
Based on GuruFocus' analysis, Warner Bros. Discovery (MIL:1WBD) is currently considered Significantly Overvalued. The stock's GF Value™ is €8.66, compared to a current price of €23.60 — trading 172.5% above its estimated fair value. The current WACC % is 9.08%, which is 25% above median its 10-year median of 7.24 and 22.8% above the Media - Diversified industry median of 7.40. Warner Bros. Discovery's overall GF Score™ is 29/100 with 6 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 Warner Bros. Discovery (MIL:1WBD), the current WACC % is 9.08% as of Jul. 03, 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 Warner Bros. Discovery (MIL:1WBD) Overvalued in 2026?
Based on GuruFocus' analysis, Warner Bros. Discovery stock appears to be overvalued.
The current stock price of €23.60 is trading 172.5% above its estimated GF Value™ of €8.66.
GuruFocus considers Warner Bros. Discovery to be Significantly Overvalued.
Key valuation signals for MIL:1WBD:
WACC %: 9.08% (25% above median its 10-year median of 7.24)
GF Value™: €8.66 vs. price of €23.60 (172.5% above fair value)
Industry Position: 22.8% above the Media - Diversified median (#774 of 1042)
No single metric tells the full story. See the MIL:1WBD stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Warner Bros. Discovery operates in three segments: streaming, studios, and linear networks. The streaming business includes HBO Max, which is rapidly increasing its international footprint in addition to its major presence in the US. Studios include industry leaders in both film and television, which produce movies and television series that are monetized in multiple ways, including theatrical release, sales to third parties, and feeding into Warner's own platforms. Global networks consist of basic cable networks like CNN, TNT, TBS, Discovery, HGTV, and The Food Network. The Discovery+ streaming service will remain part of global networks.
29GF Score
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