MRTN
Marten Transport Ltd
Price:  
12.69 
USD
Volume:  
333,457.00
United States | Road & Rail
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MRTN WACC - Weighted Average Cost of Capital

The WACC of Marten Transport Ltd (MRTN) is 7.1%.

The Cost of Equity of Marten Transport Ltd (MRTN) is 10.35%.
The Cost of Debt of Marten Transport Ltd (MRTN) is 5.00%.

Range Selected
Cost of equity 9.20% - 11.50% 10.35%
Tax rate 24.50% - 25.30% 24.90%
Cost of debt 5.00% - 5.00% 5.00%
WACC 6.5% - 7.6% 7.1%
WACC

MRTN WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.17 1.19
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.20% 11.50%
Tax rate 24.50% 25.30%
Debt/Equity ratio 1 1
Cost of debt 5.00% 5.00%
After-tax WACC 6.5% 7.6%
Selected WACC 7.1%

MRTN'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 MRTN:

cost_of_equity (10.35%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.17) + 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.