FGPR WACC - Weighted Average Cost of Capital

The WACC of Ferrellgas Partners LP (FGPR) is 11.2%.

The Cost of Equity of Ferrellgas Partners LP (FGPR) is 12.15%.

The Cost of Debt of Ferrellgas Partners LP (FGPR) is 11.10%.

	Range	Selected
Cost of equity	10.20% - 14.10%	12.15%
Tax rate	0.70% - 0.80%	0.75%
Cost of debt	6.60% - 15.60%	11.10%
WACC	7.0% - 15.3%	11.2%

WACC

FGPR WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	1.37	1.65

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.20%	14.10%

Tax rate	0.70%	0.80%
Debt/Equity ratio	6.75	6.75
Cost of debt	6.60%	15.60%

After-tax WACC	7.0%	15.3%


Selected WACC	11.2%

FGPR'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 FGPR:

cost_of_equity (12.15%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.37) + 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.