MRGO
Margo Caribe Inc
Price:  
12 
USD
Volume:  
1,720
Czechia | Food Products

MRGO WACC - Weighted Average Cost of Capital

The WACC of Margo Caribe Inc (MRGO) is 7.6%.

The Cost of Equity of Margo Caribe Inc (MRGO) is 8.4%.
The Cost of Debt of Margo Caribe Inc (MRGO) is 4.7%.

RangeSelected
Cost of equity7.3% - 9.5%8.4%
Tax rate0.8% - 1.3%1.05%
Cost of debt4.0% - 5.4%4.7%
WACC6.5% - 8.6%7.6%
WACC

MRGO WACC calculation

CategoryLowHigh
Long-term bond rate3.2%3.7%
Equity market risk premium4.2%5.2%
Adjusted beta0.971.03
Additional risk adjustments0.0%0.5%
Cost of equity7.3%9.5%
Tax rate0.8%1.3%
Debt/Equity ratio
0.290.29
Cost of debt4.0%5.4%
After-tax WACC6.5%8.6%
Selected WACC7.6%

MRGO WACC - Detailed calculations of Beta

LowHigh
Unlevered beta-0.110.14
Relevered beta0.961.04
Adjusted relevered beta0.971.03

MRGO'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 MRGO:

cost_of_equity (8.40%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * 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.