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Sonoco Products Company (SON) — WACC Analysis

WACC Breakdown

Sonoco Products Company (SON) has a weighted average cost of capital (WACC) of 6.0%. The cost of equity is 8.0%, derived from a beta of 0.67 and a risk-free rate of 4.7%. The after-tax cost of debt is 3.7%. The capital structure is 54.3% equity and 45.7% debt.

Interpretation

A WACC of 6.0% suggests that the market views Sonoco Products Company as relatively low-risk, with a lower cost of financing.

Investors can compare SON's WACC of 6.0% against industry peers to gauge its relative financing costs. A beta of 0.67 reflects the stock's volatility relative to the broader market.

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VALUATION

SON WACC: 6.04% for Sonoco Products Company

Current inputs imply a 7.98% cost of equity and a 4.73% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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[02]
WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

Sonoco Products Company Common Stock (SON) WACC Results
Weighted Average Cost of Capital
6.04%
Cost of Equity
7.98%
Risk-Free Rate4.68%
Beta0.67
Market Risk Premium4.23%
Cost of Debt
3.74%
Pre-Tax Cost of Debt4.73%
Tax Rate21.00%
Tax Shield0.99%
Capital Structure
Equity: 54.30%($5572.60M)
Debt: 45.70%($4689.51M)
Equity Component
4.33%
54.30% × 7.98%
Debt Component
1.71%
45.70% × 3.74%

Sonoco Products Company (SON) WACC in context

Sonoco Products Company (SON) currently screens with an estimated WACC of 6.04%. That blends a 7.98% cost of equity, a 4.73% pre-tax cost of debt, and a 54.30% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What SON WACC implies

A 6.04% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates SON

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.67 and equity accounts for 54.30% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.