PTVE
Pactiv Evergreen Inc
Price:  
18.01 
USD
Volume:  
5,785,949.00
United States | Containers & Packaging
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PTVE WACC - Weighted Average Cost of Capital

The WACC of Pactiv Evergreen Inc (PTVE) is 7.0%.

The Cost of Equity of Pactiv Evergreen Inc (PTVE) is 9.30%.
The Cost of Debt of Pactiv Evergreen Inc (PTVE) is 6.45%.

Range Selected
Cost of equity 8.00% - 10.60% 9.30%
Tax rate 22.20% - 29.50% 25.85%
Cost of debt 5.40% - 7.50% 6.45%
WACC 6.1% - 7.8% 7.0%
WACC

PTVE WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.9 1.02
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.00% 10.60%
Tax rate 22.20% 29.50%
Debt/Equity ratio 1.05 1.05
Cost of debt 5.40% 7.50%
After-tax WACC 6.1% 7.8%
Selected WACC 7.0%

PTVE'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 PTVE:

cost_of_equity (9.30%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.9) + 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.