CPRT
Copart Inc
Price:  
60.80 
USD
Volume:  
2,682,440.00
United States | Commercial Services & Supplies
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Copart WACC - Weighted Average Cost of Capital

The WACC of Copart Inc (CPRT) is 12.1%.

The Cost of Equity of Copart Inc (CPRT) is 7.35%.
The Cost of Debt of Copart Inc (CPRT) is 20.75%.

Range Selected
Cost of equity 5.40% - 9.30% 7.35%
Tax rate 17.80% - 19.40% 18.60%
Cost of debt 4.50% - 37.00% 20.75%
WACC 4.6% - 19.6% 12.1%
WACC

Copart WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.34 0.8
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.40% 9.30%
Tax rate 17.80% 19.40%
Debt/Equity ratio 1 1
Cost of debt 4.50% 37.00%
After-tax WACC 4.6% 19.6%
Selected WACC 12.1%

Copart'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 Copart:

cost_of_equity (7.35%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.34) + 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.