Question 1

What is Standard Motor Products's WACC?

Accepted Answer

Standard Motor Products (SMP) has a Weighted Average Cost of Capital (WACC) of 6.10%. This is calculated using a Cost of Equity of 7.89% (via CAPM with a beta of 0.72) and a pre-tax Cost of Debt of 4.72%, with an equity weight of 56.98% in the capital structure.

Question 2

Is Standard Motor Products's WACC high or low?

Accepted Answer

Standard Motor Products's WACC of 6.10% 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 Standard Motor Products's WACC calculated?

Accepted Answer

Standard Motor Products's WACC is calculated using the formula: WACC = (E/V × Re) + (D/V × Rd × (1-T)). The Cost of Equity (Re) of 7.89% is derived from the CAPM model using a beta of 0.72. The pre-tax Cost of Debt (Rd) is 4.72%. The capital structure is 56.98% equity and 43.02% debt.

Standard Motor Products (SMP) — WACC 分析

WACC 构成

解读

Standard Motor Products（SMP）WACC：6.10%

WACC计算器

Standard Motor Products（SMP） WACC 解读

SMP 公司分析

SMP DCF 估值

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