Mosaic WACC - Weighted Average Cost of Capital
The WACC of Mosaic Co (MOS) is 6.0%.
| Range | Selected | |
| Cost of equity | 5.9% - 8.1% | 7% |
| Tax rate | 26.7% - 39.8% | 33.25% |
| Cost of debt | 4.6% - 5.1% | 4.85% |
| WACC | 5.2% - 6.7% | 6.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.43 | 0.59 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.9% | 8.1% |
| Tax rate | 26.7% | 39.8% |
| Debt/Equity ratio | 0.38 | 0.38 |
| Cost of debt | 4.6% | 5.1% |
| After-tax WACC | 5.2% | 6.7% |
| Selected WACC | 6.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MOS | Mosaic Co | 0.38 | 1.12 | 0.88 |
| AVD | American Vanguard Corp | 1.18 | 1.09 | 0.58 |
| CF | CF Industries Holdings Inc | 0.2 | 0.33 | 0.29 |
| CGA | China Green Agriculture Inc | 0.62 | -0.03 | -0.02 |
| CHBU | China Agri-Business Inc | 0.04 | 1.16 | 1.13 |
| FMC | FMC Corp | 0.67 | 0.79 | 0.53 |
| IFOS.V | Itafos | 0.36 | 0.09 | 0.07 |
| MBII | Marrone Bio Innovations Inc | 0.18 | 0.36 | 0.32 |
| NZP.V | Chatham Rock Phosphate Ltd | 0.01 | -0.94 | -0.93 |
| SMG | Scotts Miracle-Gro Co | 0.62 | 0.22 | 0.15 |
| Low | High | |
| Unlevered beta | 0.23 | 0.4 |
| Relevered beta | 0.15 | 0.39 |
| Adjusted relevered beta | 0.43 | 0.59 |
Mosaic'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 Mosaic:
cost_of_equity (7.00%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.43) + 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.