BGSF WACC - Weighted Average Cost of Capital
The WACC of BGSF Inc (BGSF) is 10.1%.
| Range | Selected | |
| Cost of equity | 7.3% - 10.8% | 9.05% |
| Tax rate | 21.3% - 23.3% | 22.3% |
| Cost of debt | 4.6% - 23.9% | 14.25% |
| WACC | 5.3% - 14.9% | 10.1% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.74 | 1.06 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.3% | 10.8% |
| Tax rate | 21.3% | 23.3% |
| Debt/Equity ratio | 1.21 | 1.21 |
| Cost of debt | 4.6% | 23.9% |
| After-tax WACC | 5.3% | 14.9% |
| Selected WACC | 10.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| BGSF | BGSF Inc | 1.21 | 0.34 | 0.17 |
| CTPR | CTPartners Executive Search Inc | 1.1 | 0.02 | 0.01 |
| CWL.TO | Caldwell Partners International Inc | 0.31 | -0.6 | -0.48 |
| HQI | Hirequest Inc | 0.05 | 0.43 | 0.42 |
| JOB | GEE Group Inc | 0.01 | 0.53 | 0.53 |
| KFY | Korn Ferry | 0.12 | 1.02 | 0.93 |
| MAN | ManpowerGroup Inc | 0.49 | 0.83 | 0.6 |
| STJO | St Joseph Inc | 0.17 | -1.09 | -0.97 |
| TBI | TrueBlue Inc | 0.06 | 0.7 | 0.67 |
| TNET | TriNet Group Inc | 0.25 | 0.9 | 0.75 |
| Low | High | |
| Unlevered beta | 0.32 | 0.56 |
| Relevered beta | 0.61 | 1.09 |
| Adjusted relevered beta | 0.74 | 1.06 |
BGSF'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 BGSF:
cost_of_equity (9.05%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.74) + 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.