SGC.MI
SG Company SpA
Price:  
0.32 
EUR
Volume:  
111,750
Italy | Media

SGC.MI WACC - Weighted Average Cost of Capital

The WACC of SG Company SpA (SGC.MI) is 7.0%.

The Cost of Equity of SG Company SpA (SGC.MI) is 10.55%.
The Cost of Debt of SG Company SpA (SGC.MI) is 5%.

RangeSelected
Cost of equity8.6% - 12.5%10.55%
Tax rate21.1% - 30.2%25.65%
Cost of debt5.0% - 5.0%5%
WACC6.2% - 7.8%7.0%
WACC

SGC.MI WACC calculation

CategoryLowHigh
Long-term bond rate3.7%4.2%
Equity market risk premium8.3%9.3%
Adjusted beta0.590.85
Additional risk adjustments0.0%0.5%
Cost of equity8.6%12.5%
Tax rate21.1%30.2%
Debt/Equity ratio
1.111.11
Cost of debt5.0%5.0%
After-tax WACC6.2%7.8%
Selected WACC7.0%

SGC.MI'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 SGC.MI:

cost_of_equity (10.55%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.59) + 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.