VICI WACC - Weighted Average Cost of Capital
The WACC of VICI Properties Inc (VICI) is 6.9%.
| Range | Selected | |
| Cost of equity | 6.5% - 8.7% | 7.6% |
| Tax rate | 0.2% - 0.3% | 0.25% |
| Cost of debt | 5.3% - 5.9% | 5.6% |
| WACC | 6.1% - 7.8% | 6.9% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.57 | 0.68 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.5% | 8.7% |
| Tax rate | 0.2% | 0.3% |
| Debt/Equity ratio | 0.5 | 0.5 |
| Cost of debt | 5.3% | 5.9% |
| After-tax WACC | 6.1% | 7.8% |
| Selected WACC | 6.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| VICI | VICI Properties Inc | 0.5 | 0.23 | 0.16 |
| CONE | CyrusOne Inc | 0.31 | 0.38 | 0.29 |
| COR | CoreSite Realty Corp | 0.08 | 0.13 | 0.12 |
| CUBE | CubeSmart | 0.32 | 0.45 | 0.35 |
| EXR | Extra Space Storage Inc | 0.39 | 0.51 | 0.37 |
| GLPI | Gaming and Leisure Properties Inc | 0.59 | 0.27 | 0.17 |
| IRM | Iron Mountain Inc | 0.47 | 0.99 | 0.67 |
| LAMR | Lamar Advertising Co | 0.25 | 0.91 | 0.73 |
| LSI | Life Storage Inc | 0.15 | 1.04 | 0.9 |
| SBAC | SBA Communications Corp | 0.55 | 0.03 | 0.02 |
| Low | High | |
| Unlevered beta | 0.24 | 0.35 |
| Relevered beta | 0.36 | 0.52 |
| Adjusted relevered beta | 0.57 | 0.68 |
VICI'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 VICI:
cost_of_equity (7.60%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.57) + 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.