PGEN WACC - Weighted Average Cost of Capital
The WACC of Precigen Inc (PGEN) is 8.1%.
| Range | Selected | |
| Cost of equity | 7.5% - 10.9% | 9.2% |
| Tax rate | 0.2% - 0.3% | 0.25% |
| Cost of debt | 7.0% - 7.0% | 7% |
| WACC | 7.3% - 8.9% | 8.1% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.8 | 1.08 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.5% | 10.9% |
| Tax rate | 0.2% | 0.3% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 7.0% | 7.0% |
| After-tax WACC | 7.3% | 8.9% |
| Selected WACC | 8.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PGEN | Precigen Inc | 1.07 | 2.09 | 1.01 |
| ABBV | Abbvie Inc | 0.21 | 0.33 | 0.28 |
| AMGN | Amgen Inc | 0.41 | 0.38 | 0.27 |
| BCRX | BioCryst Pharmaceuticals Inc | 0.38 | 0.83 | 0.61 |
| CDMO | Avid Bioservices Inc | 0.2 | 1.95 | 1.63 |
| EGRX | Eagle Pharmaceuticals Inc | 2.92 | -2.02 | -0.52 |
| ENTA | Enanta Pharmaceuticals Inc | 0.01 | 1.77 | 1.75 |
| GILD | Gilead Sciences Inc | 0.2 | 0.38 | 0.31 |
| HRTX | Heron Therapeutics Inc | 0.53 | 0.81 | 0.53 |
| MDGL | Madrigal Pharmaceuticals Inc | 0.02 | 0.38 | 0.38 |
| TVTX | Travere Therapeutics Inc | 0.27 | 1.52 | 1.2 |
| Low | High | |
| Unlevered beta | 0.38 | 0.61 |
| Relevered beta | 0.7 | 1.12 |
| Adjusted relevered beta | 0.8 | 1.08 |
PGEN'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 PGEN:
cost_of_equity (9.20%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.8) + 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.