SLGN
Silgan Holdings Inc
Price:  
54.53 
USD
Volume:  
637,229.00
United States | Containers & Packaging
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SLGN WACC - Weighted Average Cost of Capital

The WACC of Silgan Holdings Inc (SLGN) is 6.2%.

The Cost of Equity of Silgan Holdings Inc (SLGN) is 7.95%.
The Cost of Debt of Silgan Holdings Inc (SLGN) is 4.80%.

Range Selected
Cost of equity 6.90% - 9.00% 7.95%
Tax rate 22.90% - 23.50% 23.20%
Cost of debt 4.00% - 5.60% 4.80%
WACC 5.3% - 7.0% 6.2%
WACC

SLGN WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.67 0.73
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.90% 9.00%
Tax rate 22.90% 23.50%
Debt/Equity ratio 0.7 0.7
Cost of debt 4.00% 5.60%
After-tax WACC 5.3% 7.0%
Selected WACC 6.2%

SLGN'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 SLGN:

cost_of_equity (7.95%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.67) + 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.