Question 1

What is The Scotts Miracle-Gro Company's WACC?

Accepted Answer

The Scotts Miracle-Gro Company (SMG) has a Weighted Average Cost of Capital (WACC) of 6.85%. This is calculated using a Cost of Equity of 8.71% (via CAPM with a beta of 1.00) and a pre-tax Cost of Debt of 4.98%, with an equity weight of 61.02% in the capital structure.

Question 2

Is The Scotts Miracle-Gro Company's WACC high or low?

Accepted Answer

The Scotts Miracle-Gro Company's WACC of 6.85% is below the typical range of 8-12% for most companies, indicating relatively low cost of capital and lower risk. WACC is used as the discount rate in DCF valuations — a lower WACC results in higher present values of future cash flows.

Question 3

How is The Scotts Miracle-Gro Company's WACC calculated?

Accepted Answer

The Scotts Miracle-Gro Company's WACC is calculated using the formula: WACC = (E/V × Re) + (D/V × Rd × (1-T)). The Cost of Equity (Re) of 8.71% is derived from the CAPM model using a beta of 1.00. The pre-tax Cost of Debt (Rd) is 4.98%. The capital structure is 61.02% equity and 38.98% debt.

The Scotts Miracle-Gro Company (SMG) — WACC 分析

WACC 构成

解读

The Scotts Miracle-Gro Company（SMG）WACC：6.85%

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The Scotts Miracle-Gro Company（SMG） WACC 解读

SMG 公司分析

SMG DCF 估值

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