GSL
Global Ship Lease Inc
Price:  
21.96 
USD
Volume:  
246,496.00
United Kingdom | Marine
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GSL WACC - Weighted Average Cost of Capital

The WACC of Global Ship Lease Inc (GSL) is 7.9%.

The Cost of Equity of Global Ship Lease Inc (GSL) is 9.90%.
The Cost of Debt of Global Ship Lease Inc (GSL) is 5.60%.

Range Selected
Cost of equity 8.30% - 11.50% 9.90%
Tax rate -% - -% -%
Cost of debt 4.90% - 6.30% 5.60%
WACC 6.7% - 9.1% 7.9%
WACC

GSL WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.97 1.18
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.30% 11.50%
Tax rate -% -%
Debt/Equity ratio 0.87 0.87
Cost of debt 4.90% 6.30%
After-tax WACC 6.7% 9.1%
Selected WACC 7.9%

GSL'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 GSL:

cost_of_equity (9.90%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.97) + 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.