COTY
Coty Inc
Price:  
4.96 
USD
Volume:  
7,828,034
United States | Personal Products

COTY WACC - Weighted Average Cost of Capital

The WACC of Coty Inc (COTY) is 8.9%.

The Cost of Equity of Coty Inc (COTY) is 9.4%.
The Cost of Debt of Coty Inc (COTY) is 13.95%.

RangeSelected
Cost of equity8.1% - 10.7%9.4%
Tax rate33.5% - 41.8%37.65%
Cost of debt4.0% - 23.9%13.95%
WACC5.5% - 12.2%8.9%
WACC

COTY WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta0.921.04
Additional risk adjustments0.0%0.5%
Cost of equity8.1%10.7%
Tax rate33.5%41.8%
Debt/Equity ratio
0.90.9
Cost of debt4.0%23.9%
After-tax WACC5.5%12.2%
Selected WACC8.9%

COTY'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 COTY:

cost_of_equity (9.40%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.92) + 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.