SELF WACC - Weighted Average Cost of Capital
The WACC of Global Self Storage Inc (SELF) is 7.3%.
| Range | Selected | |
| Cost of equity | 6.0% - 7.7% | 6.85% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 4.1% - 20.9% | 12.5% |
| WACC | 5.3% - 9.4% | 7.3% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.45 | 0.51 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.0% | 7.7% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.28 | 0.28 |
| Cost of debt | 4.1% | 20.9% |
| After-tax WACC | 5.3% | 9.4% |
| Selected WACC | 7.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SELF | Global Self Storage Inc | 0.28 | 0.12 | 0.1 |
| APR.UN.TO | Automotive Properties Real Estate Investment Trust | 0.99 | 0.24 | 0.14 |
| CORR | CorEnergy Infrastructure Trust Inc | 62.69 | 1.54 | 0.03 |
| CTT | CatchMark Timber Trust Inc | 0.58 | 1.12 | 0.78 |
| EPR | EPR Properties | 0.71 | 0.53 | 0.35 |
| FCPT | Four Corners Property Trust Inc | 0.41 | 0.21 | 0.16 |
| FPI | Farmland Partners Inc | 0.44 | 0.41 | 0.31 |
| LAND | Gladstone Land Corp | 1.69 | 0.38 | 0.17 |
| NSA | National Storage Affiliates Trust | 0.71 | 0.61 | 0.4 |
| PW | Power REIT | 9.69 | 0.9 | 0.11 |
| Low | High | |
| Unlevered beta | 0.15 | 0.23 |
| Relevered beta | 0.18 | 0.27 |
| Adjusted relevered beta | 0.45 | 0.51 |
SELF'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 SELF:
cost_of_equity (6.85%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.45) + 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.