ACTG
Acacia Research Corp
Price:  
3.79 
USD
Volume:  
201,307.00
United States | Professional Services
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

ACTG WACC - Weighted Average Cost of Capital

The WACC of Acacia Research Corp (ACTG) is 7.2%.

The Cost of Equity of Acacia Research Corp (ACTG) is 6.30%.
The Cost of Debt of Acacia Research Corp (ACTG) is 11.30%.

Range Selected
Cost of equity 5.40% - 7.20% 6.30%
Tax rate 6.30% - 10.50% 8.40%
Cost of debt 7.00% - 15.60% 11.30%
WACC 5.7% - 8.8% 7.2%
WACC

ACTG WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.23 0.33
Additional risk adjustments 0.5% 1.0%
Cost of equity 5.40% 7.20%
Tax rate 6.30% 10.50%
Debt/Equity ratio 0.31 0.31
Cost of debt 7.00% 15.60%
After-tax WACC 5.7% 8.8%
Selected WACC 7.2%

ACTG'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 ACTG:

cost_of_equity (6.30%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.23) + risk_adjustments (0.75%)

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