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Business Industry Guide: Theme Parks (as of Spring 2018): Weighted Average Cost of Capital

Doing research on the theme park industry? Use this guide to get started!

Weighted Average Cost of Capital

30 yr Treasury Rates:

  • Use the 30 year bond for the risk free rate

Market Rate (change in the S&P 500):

Example: I want to obtain the change in the S&P 500 index during 2016.

  • Click either the link for the S&P 500 or U.S. Indices
  • Click Historical Prices
  • Select Jan 1, 2016 as the Start Date and Dec 31, 2016 as the End Date
  • Select Daily for frequency (I want closing prices for the end of the year)
  • Click Get Prices
  • Scroll to the bottom of the screen and click Download to Spreadsheet

Long-term Debt and Tax Rate:

Example: I need the tax rate and long-term debt for Southwest Airlines.

  • Type in either southwest airlines or the ticker symbol (LUV) into the box
  • Click Go
  • Select Southwest Airlines
  • Click the link for Long-term debt. If the company has long-term debt, the total will be listed here.
  • Click the tab forCompany Financials
  • The default financial statement is the balance sheet. Total stockholder's equity will appear in the balance sheet.
  • From the Company Financials screen, click the link for Ratios. The Tax rate will appear on the ratios screen

Example: I need the beta for Southwest Airlines.

  • Click Dashboard at the top of the screen
  • Type Southwest Airlines into the Company Name or Ticker box at the top
  • Wait for the words to autocomplete to Southwest Airlines (LUV) and select the term

Value Line uses the New York Stock Exchange Composite Index to calculate the beta. There are more than 1,900 companies included in this index.

Example: I need the bond rate for Ford.

  • Example: I need the bond rate for Ford.

  • Type Ford into the search box and select Ford Motor Company
  • On the left-hand column, scroll down to Fixed Income and select Securities Summary
  • Use the yield for Current YTW
  • Please note: not all companies issue bonds

Example: I need a 10-K/Annual reports for Amazon. The 10-K will reveal if your company has issued coupons or other debt instruments.

  • Type amazon into the box
  • Click Go
  • Click the link for Reports
  • Search the document for terms such as bonds, convertible notes, debentures, etc.

Please note: if you check the 10-K for bond yields, make sure that you are evaluating bonds that the company *issued* rather than *purchased*.