SBLK
Star Bulk Carriers Corp
Price:  
17.92 
USD
Volume:  
856,738
Greece | Marine

SBLK WACC - Weighted Average Cost of Capital

The WACC of Star Bulk Carriers Corp (SBLK) is 8.2%.

The Cost of Equity of Star Bulk Carriers Corp (SBLK) is 9.75%.
The Cost of Debt of Star Bulk Carriers Corp (SBLK) is 5.4%.

RangeSelected
Cost of equity8.6% - 10.9%9.75%
Tax rate0.0% - 0.1%0.05%
Cost of debt4.7% - 6.1%5.4%
WACC7.2% - 9.1%8.2%
WACC

SBLK WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta1.041.09
Additional risk adjustments0.0%0.5%
Cost of equity8.6%10.9%
Tax rate0.0%0.1%
Debt/Equity ratio
0.590.59
Cost of debt4.7%6.1%
After-tax WACC7.2%9.1%
Selected WACC8.2%

SBLK'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 SBLK:

cost_of_equity (9.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.04) + 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.