As of today (2026-07-03), Silicon Laboratories's weighted average cost of capital is 12.29%%. Silicon Laboratories's ROIC % is -7.33% (calculated using TTM income statement data).
Silicon Laboratories 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.
Silicon Laboratories (STU:LA5) 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, Silicon Laboratories's weighted average cost of capital is 12.29%%. Silicon Laboratories's ROIC % is -7.33% (calculated using TTM income statement data).
Silicon Laboratories 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 Semiconductors subindustry, Silicon Laboratories'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.
Silicon Laboratories WACC % vs Semiconductors Industry
For the Semiconductors industry and Technology sector, Silicon Laboratories's WACC % distribution charts can be found below:
* The bar in red indicates where Silicon Laboratories'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, Silicon Laboratories's market capitalization (E) is €6320.066 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, Silicon Laboratories's latest one-year quarterly average Book Value of Debt (D) is €20.458 Mil.
a) weight of equity = E / (E + D) = 6320.066 / (6320.066 + 20.458) = 0.9968
b) weight of debt = D / (E + D) = 20.458 / (6320.066 + 20.458) = 0.0032
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. Silicon Laboratories's beta is 1.3059.
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% + 1.3059 * 6% = 12.3204%
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, Silicon Laboratories's interest expense (positive number) was €0.795 Mil. Its total Book Value of Debt (D) is €20.458 Mil.
Cost of Debt = 0.795 / 20.458 = 3.886%.
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 = 6.295 / -37.129 = -16.95%, which is less than 0%. Therefore it's set to 0%.
Silicon Laboratories'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)
=
0.9968
*
12.3204%
+
0.0032
*
3.886%
*
(1 - 0%)
=
12.29%
* 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.
Silicon Laboratories (STU:LA5) has a WACC % of 12.29% 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 Silicon Laboratories and its competitors. This is 11% above median its historical median of 11.12. Over the past decade, Silicon Laboratories' WACC % has ranged from 6.92 to 16.90. According to the industry distribution chart, Silicon Laboratories ranks #825 out of 1031 companies in the Semiconductors industry, placing it in the top 80%.
Is Silicon Laboratories' WACC % too high?
Silicon Laboratories' current WACC % of 12.29% is 11% above median its 10-year median of 11.12. Over the past 10 years, this metric has ranged from a low of 6.92 to a high of 16.90. The Semiconductors industry median WACC % is 9.34. Silicon Laboratories' value of 12.29% is 31.6% above this industry median. Based on the distribution chart, Silicon Laboratories ranks #825 out of 1031 companies in the Semiconductors industry, which is in the bottom quartile relative to peers. Overall, Silicon Laboratories has a GF Score™ of 79/100, reflecting its overall financial health beyond just this single metric.
How does Silicon Laboratories' WACC % compare to CRUS and VSH?
According to the Semiconductors industry distribution chart, Silicon Laboratories ranks #825 out of 1031 companies for WACC %. This places Silicon Laboratories in the lower half of its industry. The industry median WACC % is 9.34. Silicon Laboratories' value of 12.29% is 31.6% above this benchmark. Historically, Silicon Laboratories' own WACC % has ranged from 6.92 to 16.90 over the past decade. While the company's 10-year median is 11.12 vs. the industry median of 9.34, Silicon Laboratories 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 Semiconductors company?
The median WACC % among Semiconductors companies is 9.34, based on 1,031 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. Silicon Laboratories's current WACC % of 12.29% is 31.6% 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 Silicon Laboratories and its competitors. For the Semiconductors industry, the median WACC % is 9.34 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Silicon Laboratories's current WACC % is 12.29%, which is 11% above median its own 10-year median of 11.12. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Silicon Laboratories stock overvalued right now?
Silicon Laboratories (STU:LA5) has a current WACC % of 12.29%. The stock's GF Value™ is €136.88, compared to a current price of €190.00 — trading 38.8% above its estimated fair value. The current WACC % is 12.29%, which is 11% above median its 10-year median of 11.12 and 31.6% above the Semiconductors industry median of 9.34. Silicon Laboratories' overall GF Score™ is 79/100 with 5 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 Silicon Laboratories (STU:LA5), the current WACC % is 12.29% 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 Silicon Laboratories (STU:LA5) Overvalued in 2026?
Based on GuruFocus' analysis, Silicon Laboratories stock appears to be overvalued.
The current stock price of €190.00 is trading 38.8% above its estimated GF Value™ of €136.88.
Key valuation signals for STU:LA5:
WACC %: 12.29% (11% above median its 10-year median of 11.12)
GF Value™: €136.88 vs. price of €190.00 (38.8% above fair value)
Industry Position: 31.6% above the Semiconductors median (#825 of 1031)
No single metric tells the full story. See the STU:LA5 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Silicon Laboratories Inc Inc is a provider of secure, intelligent wireless technology for a more connected world. The company's integrated hardware and software platform, intuitive development tools, industry ecosystem, and robust support help customers build industrial, commercial, home, and life applications. Company make it easy for developers to solve complex wireless challenges throughout the product lifecycle and get to market quickly with solutions that transform industries, grow economies, and improve lives. Company operates in USA, China, Taiwan and Rest of World, with maximum revenue from rest of the world.
79GF Score
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