The WACC of Coty Inc (COTY) is 8.9%.
Range | Selected | |
Cost of equity | 8.1% - 10.7% | 9.4% |
Tax rate | 33.5% - 41.8% | 37.65% |
Cost of debt | 4.0% - 23.9% | 13.95% |
WACC | 5.5% - 12.2% | 8.9% |
Category | Low | High |
Long-term bond rate | 3.9% | 4.4% |
Equity market risk premium | 4.6% | 5.6% |
Adjusted beta | 0.92 | 1.04 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 8.1% | 10.7% |
Tax rate | 33.5% | 41.8% |
Debt/Equity ratio | 0.9 | 0.9 |
Cost of debt | 4.0% | 23.9% |
After-tax WACC | 5.5% | 12.2% |
Selected WACC | 8.9% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
COTY | Coty Inc | 0.9 | 0.9 | 0.58 |
ELF | e.l.f. Beauty Inc | 0.04 | 1.89 | 1.84 |
EPC | Edgewell Personal Care Co | 1.02 | 0.6 | 0.37 |
IPAR | Inter Parfums Inc | 0.04 | 0.94 | 0.92 |
JWEL.TO | Jamieson Wellness Inc | 0.3 | 0.62 | 0.52 |
MTEX | Mannatech Inc | 0.24 | 0.62 | 0.54 |
NAII | Natural Alternatives International Inc | 0.59 | -0.09 | -0.07 |
REV | Revlon Inc | 3.53 | 1.93 | 0.61 |
SUMR | Summer Infant Inc | 1.52 | 1.53 | 0.79 |
USNA | USANA Health Sciences Inc | 0.04 | 0.92 | 0.9 |
Low | High | |
Unlevered beta | 0.56 | 0.68 |
Relevered beta | 0.88 | 1.06 |
Adjusted relevered beta | 0.92 | 1.04 |
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.