EXPR WACC - Weighted Average Cost of Capital
The WACC of Express Inc (EXPR) is 9.0%.
| Range | Selected | |
| Cost of equity | 44.7% - 148.8% | 96.75% |
| Tax rate | 5.1% - 13.3% | 9.2% |
| Cost of debt | 7.0% - 7.0% | 7% |
| WACC | 7.8% - 10.3% | 9.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 8.88 | 25.7 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 44.7% | 148.8% |
| Tax rate | 5.1% | 13.3% |
| Debt/Equity ratio | 32.62 | 32.62 |
| Cost of debt | 7.0% | 7.0% |
| After-tax WACC | 7.8% | 10.3% |
| Selected WACC | 9.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| EXPR | Express Inc | 32.62 | 1.25 | 0.04 |
| ANF | Abercrombie & Fitch Co | 1.14 | 1.03 | 0.5 |
| BOOT | Boot Barn Holdings Inc | 0 | 1.44 | 1.44 |
| CAL | Caleres Inc | 0.43 | 0.52 | 0.37 |
| CHS | Chico's FAS Inc | 0.05 | 0.08 | 0.08 |
| GCO | Genesco Inc | 1.13 | 1.98 | 0.96 |
| GES | Guess? Inc | 0.89 | 0.61 | 0.33 |
| JILL | J.Jill Inc | 0.29 | 1.24 | 0.98 |
| PLCE | Children's Place Inc | 3.27 | 3.5 | 0.86 |
| SMRTQ | Stein Mart Inc | 188.09 | -0.34 | 0 |
| Low | High | |
| Unlevered beta | 0.36 | 0.65 |
| Relevered beta | 12.76 | 37.87 |
| Adjusted relevered beta | 8.88 | 25.7 |
EXPR'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 EXPR:
cost_of_equity (96.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (8.88) + 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.