SPNE
SeaSpine Holdings Corp
Price:  
9.54 
USD
Volume:  
1,146,420.00
United States | Health Care Equipment & Supplies
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SPNE WACC - Weighted Average Cost of Capital

The WACC of SeaSpine Holdings Corp (SPNE) is 7.1%.

The Cost of Equity of SeaSpine Holdings Corp (SPNE) is 7.25%.
The Cost of Debt of SeaSpine Holdings Corp (SPNE) is 7.00%.

Range Selected
Cost of equity 5.60% - 8.90% 7.25%
Tax rate 0.80% - 1.40% 1.10%
Cost of debt 7.00% - 7.00% 7.00%
WACC 6.3% - 7.9% 7.1%
WACC

SPNE WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.38 0.72
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.60% 8.90%
Tax rate 0.80% 1.40%
Debt/Equity ratio 1 1
Cost of debt 7.00% 7.00%
After-tax WACC 6.3% 7.9%
Selected WACC 7.1%

SPNE'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 SPNE:

cost_of_equity (7.25%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.38) + 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.