Summer Energy Holdings Inc (SUME) WACC Analysis

As of May 24, 2025, Summer Energy Holdings Inc (SUME) carries a Weighted Average Cost of Capital (WACC) of 9.6%. WACC reflects the blended rate Summer Energy Holdings Inc must pay to both equity and debt holders.

Within that, the cost of equity is 6.3%, the cost of debt is 7.0%, and the effective tax rate is 5.2%.

Breakdown of WACC Components

• Long-term bond rate: 3.9% – 4.4%
• Equity market risk premium: 4.6% – 5.6%
• Adjusted beta: 0.53 – 0.62
• Additional risk adjustment: 0.0% – 0.5%
• Debt-to-equity ratio: 0.49

What It Means for Investors

With a selected WACC of 9.6%, Summer Energy Holdings Inc must ensure any new investment returns exceed this threshold to generate shareholder value. This level reflects a moderate financing cost structure.