MCFT
Mastercraft Boat Holdings Inc
Price:  
16.86 
USD
Volume:  
50,462
United States | Leisure Products

MCFT WACC - Weighted Average Cost of Capital

The WACC of Mastercraft Boat Holdings Inc (MCFT) is 8.2%.

The Cost of Equity of Mastercraft Boat Holdings Inc (MCFT) is 8.9%.
The Cost of Debt of Mastercraft Boat Holdings Inc (MCFT) is 5.75%.

RangeSelected
Cost of equity7.5% - 10.3%8.9%
Tax rate22.5% - 23.2%22.85%
Cost of debt4.0% - 7.5%5.75%
WACC6.8% - 9.6%8.2%
WACC

MCFT WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta0.780.97
Additional risk adjustments0.0%0.5%
Cost of equity7.5%10.3%
Tax rate22.5%23.2%
Debt/Equity ratio
0.170.17
Cost of debt4.0%7.5%
After-tax WACC6.8%9.6%
Selected WACC8.2%

MCFT WACC - Detailed calculations of Beta

LowHigh
Unlevered beta0.710.89
Relevered beta0.670.96
Adjusted relevered beta0.780.97

MCFT'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 MCFT:

cost_of_equity (8.90%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.78) + 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.