MG
Mistras Group Inc
Price:  
9.46 
USD
Volume:  
101,141.00
United States | Professional Services
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MG WACC - Weighted Average Cost of Capital

The WACC of Mistras Group Inc (MG) is 7.4%.

The Cost of Equity of Mistras Group Inc (MG) is 8.95%.
The Cost of Debt of Mistras Group Inc (MG) is 6.50%.

Range Selected
Cost of equity 7.40% - 10.50% 8.95%
Tax rate 18.20% - 24.80% 21.50%
Cost of debt 6.00% - 7.00% 6.50%
WACC 6.4% - 8.4% 7.4%
WACC

MG WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.77 1
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.40% 10.50%
Tax rate 18.20% 24.80%
Debt/Equity ratio 0.65 0.65
Cost of debt 6.00% 7.00%
After-tax WACC 6.4% 8.4%
Selected WACC 7.4%

MG'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 MG:

cost_of_equity (8.95%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.77) + 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.