AAWW
Atlas Air Worldwide Holdings Inc
Price:  
102.48 
USD
Volume:  
1,527,210
United States | Air Freight & Logistics

AAWW WACC - Weighted Average Cost of Capital

The WACC of Atlas Air Worldwide Holdings Inc (AAWW) is 7.4%.

The Cost of Equity of Atlas Air Worldwide Holdings Inc (AAWW) is 10.65%.
The Cost of Debt of Atlas Air Worldwide Holdings Inc (AAWW) is 4.4%.

RangeSelected
Cost of equity9.1% - 12.2%10.65%
Tax rate23.4% - 25.3%24.35%
Cost of debt4.0% - 4.8%4.4%
WACC6.5% - 8.4%7.4%
WACC

AAWW WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta1.141.31
Additional risk adjustments0.0%0.5%
Cost of equity9.1%12.2%
Tax rate23.4%25.3%
Debt/Equity ratio
0.780.78
Cost of debt4.0%4.8%
After-tax WACC6.5%8.4%
Selected WACC7.4%

AAWW's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for AAWW:

cost_of_equity (10.65%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.14) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.