SELB
Selecta Biosciences Inc
Price:  
0.88 
USD
Volume:  
2,774,130
United States | Biotechnology

SELB WACC - Weighted Average Cost of Capital

The WACC of Selecta Biosciences Inc (SELB) is 10.3%.

The Cost of Equity of Selecta Biosciences Inc (SELB) is 11.35%.
The Cost of Debt of Selecta Biosciences Inc (SELB) is 7%.

RangeSelected
Cost of equity9.8% - 12.9%11.35%
Tax rate26.2% - 27.0%26.6%
Cost of debt7.0% - 7.0%7%
WACC9.1% - 11.6%10.3%
WACC

SELB WACC calculation

CategoryLowHigh
Long-term bond rate4.2%4.7%
Equity market risk premium5.0%6.0%
Adjusted beta1.131.29
Additional risk adjustments0.0%0.5%
Cost of equity9.8%12.9%
Tax rate26.2%27.0%
Debt/Equity ratio
0.190.19
Cost of debt7.0%7.0%
After-tax WACC9.1%11.6%
Selected WACC10.3%

SELB'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 SELB:

cost_of_equity (11.35%) = risk_free_rate (4.45%) + equity_risk_premium (5.50%) * adjusted_beta (1.13) + 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.