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Samsara Luggage WACC %

:33.43% (As of Today)
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As of today (2021-12-01), Samsara Luggage's weighted average cost of capital is 33.43%. Samsara Luggage's ROIC % is -156.10% (calculated using TTM income statement data). Samsara Luggage earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Samsara Luggage WACC % Historical Data

The historical data trend for Samsara Luggage'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.

* Premium members only.

Samsara Luggage Annual Data
Trend Jul11 Jul12 Jul13 Jul14 Jul15 Jul16 Jul17 Jul18 Jul19 Dec20
WACC %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only - - 11.73 10.77 38.80

Samsara Luggage Quarterly Data
Oct16 Jan17 Apr17 Jul17 Oct17 Jan18 Apr18 Jul18 Oct18 Jan19 Apr19 Jul19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21
WACC % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 20.43 38.80 32.19 18.44 12.62

Competitive Comparison

For the Footwear & Accessories subindustry, Samsara Luggage'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.

   

Samsara Luggage WACC % Distribution

For the Manufacturing - Apparel & Accessories industry and Consumer Cyclical sector, Samsara Luggage's WACC % distribution charts can be found below:

* The bar in red indicates where Samsara Luggage's WACC % falls into.



Samsara Luggage WACC % Calculation

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, Samsara Luggage's market capitalization (E) is $2.104 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 two-year average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Sep. 2021, Samsara Luggage's latest two-year average Short-Term Debt & Capital Lease Obligation was $0.1845 Mil and its latest two-year average Long-Term Debt & Capital Lease Obligation was $0.462 Mil. The total Book Value of Debt (D) is $0.6465 Mil.
a) weight of equity = E / (E + D) = 2.104 / (2.104 + 0.6465) = 0.765
b) weight of debt = D / (E + D) = 0.6465 / (2.104 + 0.6465) = 0.235

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 1.52000000%. 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. Samsara Luggage's beta is 2.99.
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 = 1.52000000% + 2.99 * 6% = 19.46%

3. Cost of Debt:
GuruFocus uses last fiscal year end Interest Expense divided by the latest two-year average debt to get the simplified cost of debt.
As of Dec. 2020, Samsara Luggage's interest expense (positive number) was $0.51 Mil. Its total Book Value of Debt (D) is $0.6465 Mil.
Cost of Debt = 0.51 / 0.6465 = 78.8863%.

4. Multiply by one minus Average Tax Rate:
GuruFocus uses the latest two-year average tax rate to do the calculation. The calculated average tax rate is limited to between 0% and 100%. If the calculated average tax rate is higher than 100%, it is set to 100%. If the calculated average tax rate is less than 0%, it is set to 0%.
The latest Two-year Average Tax Rate is 0%.

Samsara Luggage'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)
=0.765*19.46%+0.235*78.8863%*(1 - 0%)
=33.43%

* 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.


Samsara Luggage  (OTCPK:SAML) 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, Samsara Luggage's weighted average cost of capital is 33.43%. Samsara Luggage's ROIC % is -156.10% (calculated using TTM income statement data). Samsara Luggage 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 two-year average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.

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 last fiscal year end Interest Expense divided by the latest two-year average debt to get the simplified cost of debt.


Related Terms

Samsara Luggage Business Description

Samsara Luggage logo
Traded in Other Exchanges
N/A
Address
One University Plaza, Suite 505, Hackensack, NJ, USA, 07601
Samsara Luggage Inc designs manufactures and sells high-quality luggage products to meet the evolving needs of travelers. The company generates revenues through the sale and distribution of smart luggage products.
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