Sandoz Group AGMEX:SDZN 16 WACC % is 5.98% as of Jun. 27, 2026, which is 3% above its 10-year median of 5.82. GuruFocus rates MEX:SDZN with a GF Score™ of 16/100. The stock has 6 warning signs investors should review. Among 1,020 Drug Manufacturers companies, Sandoz Group AG ranks better than 70% on this metric.
As of today (2026-06-27), Sandoz Group AG's weighted average cost of capital is 5.98%%. Sandoz Group AG's ROIC % is 6.00% (calculated using TTM income statement data).
Sandoz Group AG generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
*Note: The beta of this company cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
For a comprehensive WACC calculation, please access the WACC Calculator.
Sandoz Group AG (MEX:SDZN) WACC % Explanation
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, Sandoz Group AG's weighted average cost of capital is 5.98%%. Sandoz Group AG's ROIC % is 6.00% (calculated using TTM income statement data).
Sandoz Group AG generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
*Note: The beta of this company cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
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.
Related Terms
Sandoz Group AG WACC % Historical Data
* Premium members only.
The historical data trend for Sandoz Group AG's WACC % can be seen below:
* 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 Drug Manufacturers - Specialty & Generic subindustry, Sandoz Group AG'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.
Sandoz Group AG WACC % vs Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Sandoz Group AG's WACC % distribution charts can be found below:
* The bar in red indicates where Sandoz Group AG'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, Sandoz Group AG's market capitalization (E) is MXN672006.571 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, Sandoz Group AG's latest one-year semi-annual average Book Value of Debt (D) is MXN103577.9137 Mil.
a) weight of equity = E / (E + D) = 672006.571 / (672006.571 + 103577.9137) = 0.8665
b) weight of debt = D / (E + D) = 103577.9137 / (672006.571 + 103577.9137) = 0.1335
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 0.44%. 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. Sandoz Group AG's beta cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
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 = 0.44% + 1 * 6% = 6.44%
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, Sandoz Group AG's interest expense (positive number) was MXN4052.662 Mil. Its total Book Value of Debt (D) is MXN103577.9137 Mil.
Cost of Debt = 4052.662 / 103577.9137 = 3.9127%.
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 = 5380.254 / 22147.924 = 24.29%.
Sandoz Group AG'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)
=
0.8665
*
6.44%
+
0.1335
*
3.9127%
*
(1 - 24.29%)
=
5.98%
* 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.
Sandoz Group AG (MEX:SDZN) has a WACC % of 5.98% 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 Sandoz Group AG and its competitors. This is near median its historical median of 5.82. Over the past decade, Sandoz Group AG's WACC % has ranged from 5.03 to 6.42. According to the industry distribution chart, Sandoz Group AG ranks #306 out of 1020 companies in the Drug Manufacturers industry, placing it in the top 30%.
Is Sandoz Group AG's WACC % too high?
Sandoz Group AG's current WACC % of 5.98% is near median its 10-year median of 5.82. Over the past 10 years, this metric has ranged from a low of 5.03 to a high of 6.42. The Drug Manufacturers industry median WACC % is 8.90. Sandoz Group AG's value of 5.98% is 32.8% below this industry median. Based on the distribution chart, Sandoz Group AG ranks #306 out of 1020 companies in the Drug Manufacturers industry, which is above the industry midpoint. Overall, Sandoz Group AG has a GF Score™ of 16/100, reflecting its overall financial health beyond just this single metric.
How does Sandoz Group AG's WACC % compare to ZTS and UTHR?
According to the Drug Manufacturers industry distribution chart, Sandoz Group AG ranks #306 out of 1020 companies for WACC %. This puts Sandoz Group AG in the upper half of its industry. The industry median WACC % is 8.90. Sandoz Group AG's value of 5.98% is 32.8% below this benchmark. Historically, Sandoz Group AG's own WACC % has ranged from 5.03 to 6.42 over the past decade. While the company's 10-year median is 5.82 vs. the industry median of 8.90, Sandoz Group AG has consistently been below 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 a Drug Manufacturers company?
The median WACC % among Drug Manufacturers companies is 8.90, based on 1,020 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. Sandoz Group AG's current WACC % of 5.98% is 32.8% below 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 Sandoz Group AG and its competitors. For the Drug Manufacturers industry, the median WACC % is 8.90 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Sandoz Group AG's current WACC % is 5.98%, which is near median its own 10-year median of 5.82. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sandoz Group AG stock overvalued right now?
Sandoz Group AG (MEX:SDZN) has a current WACC % of 5.98%. The current WACC % is 5.98%, which is near median its 10-year median of 5.82 and 32.8% below the Drug Manufacturers industry median of 8.90. Sandoz Group AG's overall GF Score™ is 16/100 with 6 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 Sandoz Group AG (MEX:SDZN), the current WACC % is 5.98% 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.
Sandoz is one of the largest generic pharmaceutical manufacturers in the world, generating over $11 billion annually from off-patent drugs. Once part of Novartis, Sandoz spun off and went public in October 2023. Generics, including small molecules and complex injectables, make up roughly 75% of Sandoz's total sales, and the firm has a significant presence in Europe, the United States, and other key international markets. Sandoz generates its remaining sales from biosimilars and is among the leaders in the space. Sandoz launched Europe's first biosimilar, Omnitrope, in 2006, as well as the first US biosimilar, Zarxio, in 2015. It has over 10 launched biosimilars in a number of markets and over 20 assets in its pipeline.
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