RPT
RPT Realty
Price:  
2.66 
USD
Volume:  
251,593.00
United States | Equity Real Estate Investment Trusts (REITs)
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RPT WACC - Weighted Average Cost of Capital

The WACC of RPT Realty (RPT) is 6.7%.

The Cost of Equity of RPT Realty (RPT) is 18.45%.
The Cost of Debt of RPT Realty (RPT) is 4.80%.

Range Selected
Cost of equity 13.10% - 23.80% 18.45%
Tax rate 0.50% - 0.50% 0.50%
Cost of debt 4.00% - 5.60% 4.80%
WACC 5.2% - 8.1% 6.7%
WACC

RPT WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 2 3.39
Additional risk adjustments 0.0% 0.5%
Cost of equity 13.10% 23.80%
Tax rate 0.50% 0.50%
Debt/Equity ratio 6.24 6.24
Cost of debt 4.00% 5.60%
After-tax WACC 5.2% 8.1%
Selected WACC 6.7%

RPT'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 RPT:

cost_of_equity (18.45%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (2) + 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.