BGS
B&G Foods Inc
Price:  
4.51 
USD
Volume:  
1,652,815
United States | Food Products

B&G WACC - Weighted Average Cost of Capital

The WACC of B&G Foods Inc (BGS) is 7.6%.

The Cost of Equity of B&G Foods Inc (BGS) is 13.25%.
The Cost of Debt of B&G Foods Inc (BGS) is 9%.

RangeSelected
Cost of equity9.1% - 17.4%13.25%
Tax rate24.9% - 26.3%25.6%
Cost of debt5.6% - 12.4%9%
WACC4.9% - 10.3%7.6%
WACC

B&G WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta1.132.24
Additional risk adjustments0.0%0.5%
Cost of equity9.1%17.4%
Tax rate24.9%26.3%
Debt/Equity ratio
5.775.77
Cost of debt5.6%12.4%
After-tax WACC4.9%10.3%
Selected WACC7.6%

B&G's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for B&G:

cost_of_equity (13.25%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.13) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.