SEGI WACC - Weighted Average Cost of Capital
The WACC of Sycamore Entertainment Group Inc (SEGI) is 4.2%.
| Range | Selected | |
| Cost of equity | 5.2% - 6.7% | 5.95% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.1% - 4.4% | 4.2% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.29 | 0.33 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.2% | 6.7% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 2.98 | 2.98 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.1% | 4.4% |
| Selected WACC | 4.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SEGI | Sycamore Entertainment Group Inc | 2.98 | -1.02 | -0.32 |
| AMRU | Amaru Inc | 6360.53 | 1.62 | 0 |
| FMYR | BOMCBD Corp | 7828.93 | 0.38 | 0 |
| FUGI | Fuego Enterprises Inc | 0.3 | -0.74 | -0.6 |
| KUKE | Kuke Music Holding Ltd | 0.81 | -0.48 | -0.3 |
| MVES | Movie Studio Inc | 154.86 | -0.27 | 0 |
| SAPX | Seven Arts Entertainment Inc | 99.78 | 1.07 | 0.01 |
| SSET | StarStream Entertainment Inc | 13.02 | 1.87 | 0.18 |
| UMGP | Universal Media Group Inc | 9.75 | -0.32 | -0.04 |
| YVR | Liquid Media Group Ltd | 0.1 | 0.71 | 0.66 |
| Low | High | |
| Unlevered beta | -0.02 | 0 |
| Relevered beta | -0.06 | 0 |
| Adjusted relevered beta | 0.29 | 0.33 |
SEGI'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 SEGI:
cost_of_equity (5.95%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.29) + 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.