UTZ WACC - Weighted Average Cost of Capital

The WACC of UTZ Brands Inc (UTZ) is 6.8%.

The Cost of Equity of UTZ Brands Inc (UTZ) is 7.10%.

The Cost of Debt of UTZ Brands Inc (UTZ) is 8.50%.

	Range	Selected
Cost of equity	6.30% - 7.90%	7.10%
Tax rate	26.20% - 27.00%	26.60%
Cost of debt	4.60% - 12.40%	8.50%
WACC	5.4% - 8.3%	6.8%

WACC

UTZ WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	0.53	0.54

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.30%	7.90%

Tax rate	26.20%	27.00%
Debt/Equity ratio	0.47	0.47
Cost of debt	4.60%	12.40%

After-tax WACC	5.4%	8.3%


Selected WACC	6.8%

UTZ'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 UTZ:

cost_of_equity (7.10%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.53) + 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.