MLI
Mueller Industries Inc
Price:  
75.16 
USD
Volume:  
473,690.00
United States | Machinery
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MLI WACC - Weighted Average Cost of Capital

The WACC of Mueller Industries Inc (MLI) is 9.2%.

The Cost of Equity of Mueller Industries Inc (MLI) is 9.20%.
The Cost of Debt of Mueller Industries Inc (MLI) is 5.00%.

Range Selected
Cost of equity 8.00% - 10.40% 9.20%
Tax rate 25.70% - 26.00% 25.85%
Cost of debt 5.00% - 5.00% 5.00%
WACC 8.0% - 10.4% 9.2%
WACC

MLI WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.9 0.99
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.00% 10.40%
Tax rate 25.70% 26.00%
Debt/Equity ratio 0 0
Cost of debt 5.00% 5.00%
After-tax WACC 8.0% 10.4%
Selected WACC 9.2%

MLI'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 MLI:

cost_of_equity (9.20%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.9) + 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.