FS Credit OpportunitiesFSCO +1.90%44 WACC % is 7.71% as of Jun. 27, 2026, which is 27% below its 10-year median of 10.52. GuruFocus rates FSCO with a GF Score™ of 44/100 and a GF Value™ of $5.33 (Fairly Valued). The stock has 4 warning signs investors should review. Among 1,653 Asset Management companies, FS Credit Opportunities ranks worse than 65.64% on this metric.
As of today (2026-06-27), FS Credit Opportunities's weighted average cost of capital is 7.71%%. FS Credit Opportunities's ROIC % is 0.00% (calculated using TTM income statement data).
FS Credit Opportunities earns returns that do not match up to its cost of capital. It will destroy value as it grows.
For a comprehensive WACC calculation, please access the WACC Calculator.
Because it costs money to raise capital. A firm that generates higher ROIC % than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, FS Credit Opportunities's weighted average cost of capital is 7.71%%. FS Credit Opportunities's ROIC % is 0.00% (calculated using TTM income statement data).
FS Credit Opportunities earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.
For companies that report quarterly, GuruFocus combines all of the most recent year's quarterly debt data from the beginning of the year to the year-end and calculates the average.
For companies that report semi-annually, GuruFocus combines all of the most recent year's semi-annual debt data from the start of the year to the year-end and calculates the average.
For companies that report annually, GuruFocus combines the beginning and ending annual debt data from the most recent year and then calculates the average.
2. The WACC formula discussed above does not include Preferred Stock. Please adjust if preferred stock is considered.
3. (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
4. GuruFocus uses the latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Asset Management subindustry, FS Credit Opportunities's WACC %, along with its competitors' market caps and WACC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
FS Credit Opportunities WACC % vs Asset Management Industry
For the Asset Management industry and Financial Services sector, FS Credit Opportunities's WACC % distribution charts can be found below:
* The bar in red indicates where FS Credit Opportunities's WACC % falls into.
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of capital. Generally speaking, a company's assets are financed by debt and equity. WACC is the average of the costs of these sources of financing, each of which is weighted by its respective use in the given situation. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances.
WACC
=
E
/
(E + D)
*
Cost of Equity
+
D
/
(E + D)
*
Cost of Debt
*
(1 - Tax Rate)
1. Weights:
Generally speaking, a company's assets are financed by debt and equity. We need to calculate the weight of equity and the weight of debt.
The market value of equity (E) is also called "Market Cap". As of today, FS Credit Opportunities's market capitalization (E) is $976.962 Mil.
The market value of debt is typically difficult to calculate, therefore, GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding the latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Dec. 2025, FS Credit Opportunities's latest one-year semi-annual average Book Value of Debt (D) is $341 Mil.
a) weight of equity = E / (E + D) = 976.962 / (976.962 + 341) = 0.7413
b) weight of debt = D / (E + D) = 341 / (976.962 + 341) = 0.2587
2. Cost of Equity:
GuruFocus uses Capital Asset Pricing Model (CAPM) to calculate the required rate of return. The formula is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
a) GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate. It is updated daily. The current risk-free rate is 4.376%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default.
b) Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. FS Credit Opportunities's beta is 0.2746.
c) (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
Cost of Equity = 4.376% + 0.2746 * 6% = 6.0236%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
As of Dec. 2025, FS Credit Opportunities's interest expense (positive number) was $42.759 Mil. Its total Book Value of Debt (D) is $341 Mil.
Cost of Debt = 42.759 / 341 = 12.5393%.
4. Multiply by one minus TTM Tax Rate:
GuruFocus uses the most recent TTM Tax Expense divided by the most recent TTM Pre-Tax Income to calculate the tax rate. The calculated TTM tax rate is limited to between 0% and 100%. If the calculated tax rate is higher than 100%, it is set to 100%. If the calculated tax rate is less than 0%, it is set to 0%.
The latest calculated TTM Tax Rate = 0 / 153.752 = 0%.
FS Credit Opportunities's Weighted Average Cost Of Capital (WACC) for Today is calculated as:
WACC
=
E / (E + D)
*
Cost of Equity
+
D / (E + D)
*
Cost of Debt
*
(1 - Tax Rate)
=
0.7413
*
6.0236%
+
0.2587
*
12.5393%
*
(1 - 0%)
=
7.71%
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
FS Credit Opportunities (FSCO) has a WACC % of 7.71% as of Jun. 27, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on FS Credit Opportunities and its competitors. This is 27% below median its historical median of 10.52. Over the past decade, FS Credit Opportunities' WACC % has ranged from 7.00 to 11.02. According to the industry distribution chart, FS Credit Opportunities ranks #1085 out of 1653 companies in the Asset Management industry, placing it in the top 65.6%.
Is FS Credit Opportunities' WACC % too high?
FS Credit Opportunities' current WACC % of 7.71% is 27% below median its 10-year median of 10.52. Over the past 10 years, this metric has ranged from a low of 7.00 to a high of 11.02. The Asset Management industry median WACC % is 5.68. FS Credit Opportunities' value of 7.71% is 35.7% above this industry median. Based on the distribution chart, FS Credit Opportunities ranks #1085 out of 1653 companies in the Asset Management industry, which is below the industry midpoint. Overall, FS Credit Opportunities has a GF Score™ of 44/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does FS Credit Opportunities' WACC % compare to MUC and BUR?
According to the Asset Management industry distribution chart, FS Credit Opportunities ranks #1085 out of 1653 companies for WACC %. This places FS Credit Opportunities in the lower half of its industry. The industry median WACC % is 5.68. FS Credit Opportunities' value of 7.71% is 35.7% above this benchmark. Historically, FS Credit Opportunities' own WACC % has ranged from 7.00 to 11.02 over the past decade. While the company's 10-year median is 10.52 vs. the industry median of 5.68, FS Credit Opportunities has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good WACC % for an Asset Management company?
The median WACC % among Asset Management companies is 5.68, based on 1,653 companies in the industry. Companies in the top quartile (top 25%) have a WACC % significantly above this median, while those in the bottom quartile fall well below. However, WACC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. FS Credit Opportunities's current WACC % of 7.71% is 35.7% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high WACC % mean?
A high WACC % can signal that a stock is expensive relative to its fundamentals. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on FS Credit Opportunities and its competitors. For the Asset Management industry, the median WACC % is 5.68 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. FS Credit Opportunities's current WACC % is 7.71%, which is 27% below median its own 10-year median of 10.52. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is FS Credit Opportunities stock overvalued right now?
Based on GuruFocus' analysis, FS Credit Opportunities (FSCO) is currently considered Fairly Valued. The stock's GF Value™ is $5.33, compared to a current price of $4.83 — trading 9.4% below its estimated fair value. The current WACC % is 7.71%, which is 27% below median its 10-year median of 10.52 and 35.7% above the Asset Management industry median of 5.68. FS Credit Opportunities' overall GF Score™ is 44/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is WACC % calculated?
WACC % is calculated from a company's financial statements. For FS Credit Opportunities (FSCO), the current WACC % is 7.71% as of Jun. 27, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is FS Credit Opportunities (FSCO) Overvalued in 2026?
Based on GuruFocus' analysis, FS Credit Opportunities stock appears to be undervalued.
The current stock price of $4.83 is trading 9.4% below its estimated GF Value™ of $5.33.
GuruFocus considers FS Credit Opportunities to be Fairly Valued.
Key valuation signals for FSCO:
WACC %: 7.71% (27% below median its 10-year median of 10.52)
GF Value™: $5.33 vs. price of $4.83 (9.4% below fair value)
Industry Position: 35.7% above the Asset Management median (#1085 of 1653)
No single metric tells the full story. See the FSCO stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
FS Credit Opportunities Corp is a closed-end management investment company. The Fund's primary investment objective is to generate an attractive total return consisting of a high level of current income and capital appreciation, with a secondary objective of capital preservation. It predominantly invests in a portfolio of secured and unsecured floating and fixed-rate loans, bonds, and other types of credit instruments. The credit instruments in which it invests are typically rated below investment grade by rating agencies or would be rated below investment grade if rated. To achieve its investment objectives, the fund focuses on strategies such as Opportunistic Credit, Special Situations, and Capital Structure Solutions.
44GF Score
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