UFPT
UFP Technologies Inc
Price:  
244.16 
USD
Volume:  
108,692.00
United States | Containers & Packaging
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UFPT WACC - Weighted Average Cost of Capital

The WACC of UFP Technologies Inc (UFPT) is 7.8%.

The Cost of Equity of UFP Technologies Inc (UFPT) is 7.50%.
The Cost of Debt of UFP Technologies Inc (UFPT) is 12.95%.

Range Selected
Cost of equity 6.40% - 8.60% 7.50%
Tax rate 18.70% - 19.80% 19.25%
Cost of debt 4.80% - 21.10% 12.95%
WACC 6.2% - 9.4% 7.8%
WACC

UFPT WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.56 0.66
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.40% 8.60%
Tax rate 18.70% 19.80%
Debt/Equity ratio 0.1 0.1
Cost of debt 4.80% 21.10%
After-tax WACC 6.2% 9.4%
Selected WACC 7.8%

UFPT'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 UFPT:

cost_of_equity (7.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.56) + 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.