The WACC of Oxford Industries Inc (OXM) is 7.9%.
Range | Selected | |
Cost of equity | 6.8% - 9.5% | 8.15% |
Tax rate | 20.2% - 21.4% | 20.8% |
Cost of debt | 4.5% - 4.5% | 4.5% |
WACC | 6.6% - 9.2% | 7.9% |
Category | Low | High |
Long-term bond rate | 3.9% | 4.4% |
Equity market risk premium | 4.6% | 5.6% |
Adjusted beta | 0.63 | 0.82 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.8% | 9.5% |
Tax rate | 20.2% | 21.4% |
Debt/Equity ratio | 0.04 | 0.04 |
Cost of debt | 4.5% | 4.5% |
After-tax WACC | 6.6% | 9.2% |
Selected WACC | 7.9% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
OXM | Oxford Industries Inc | 0.04 | 0.49 | 0.48 |
BEAN.CN | Peekaboo Beans Inc | 0.96 | -0.17 | -0.09 |
CRI | Carter's Inc | 0.44 | 0.51 | 0.38 |
GOOS.TO | Canada Goose Holdings Inc | 0.46 | 1.15 | 0.84 |
LAKE | Lakeland Industries Inc | 0.1 | 0.93 | 0.86 |
RL | Ralph Lauren Corp | 0.08 | 1.16 | 1.09 |
SGC | Superior Group of Companies Inc | 0.54 | 1.06 | 0.74 |
SQBG | Sequential Brands Group Inc | 43.76 | 1.5 | 0.04 |
VNCE | Vince Holding Corp | 2.37 | -0.66 | -0.23 |
VAKKO.IS | Vakko Tekstil ve Hazir Giyim Sanayi Isletmeleri AS | 0.31 | 0.86 | 0.69 |
Low | High | |
Unlevered beta | 0.44 | 0.71 |
Relevered beta | 0.45 | 0.73 |
Adjusted relevered beta | 0.63 | 0.82 |
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 OXM:
cost_of_equity (8.15%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.63) + 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.