ADMA
ADMA Biologics Inc
Price:  
19.84 
USD
Volume:  
2,788,067.00
United States | Biotechnology
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ADMA WACC - Weighted Average Cost of Capital

The WACC of ADMA Biologics Inc (ADMA) is 8.2%.

The Cost of Equity of ADMA Biologics Inc (ADMA) is 8.20%.
The Cost of Debt of ADMA Biologics Inc (ADMA) is 8.25%.

Range Selected
Cost of equity 6.80% - 9.60% 8.20%
Tax rate 26.20% - 27.00% 26.60%
Cost of debt 4.60% - 11.90% 8.25%
WACC 6.8% - 9.6% 8.2%
WACC

ADMA WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.65 0.84
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.80% 9.60%
Tax rate 26.20% 27.00%
Debt/Equity ratio 0.02 0.02
Cost of debt 4.60% 11.90%
After-tax WACC 6.8% 9.6%
Selected WACC 8.2%

ADMA'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 ADMA:

cost_of_equity (8.20%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.65) + 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.