The WACC of Syros Pharmaceuticals Inc (SYRS) is 21.8%.
| Range | Selected | |
| Cost of equity | 48.20% - 105.50% | 76.85% |
| Tax rate | 26.20% - 27.00% | 26.60% |
| Cost of debt | 7.00% - 48.80% | 27.90% |
| WACC | 6.3% - 37.4% | 21.8% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 9.64 | 17.96 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 48.20% | 105.50% |
| Tax rate | 26.20% | 27.00% |
| Debt/Equity ratio | 38.41 | 38.41 |
| Cost of debt | 7.00% | 48.80% |
| After-tax WACC | 6.3% | 37.4% |
| Selected WACC | 21.8% | |
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 SYRS:
cost_of_equity (76.85%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (9.64) + 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.