AKRN.ME WACC - Weighted Average Cost of Capital

The WACC of Akron PAO (AKRN.ME) is 20.1%.

The Cost of Equity of Akron PAO (AKRN.ME) is 22.60%.

The Cost of Debt of Akron PAO (AKRN.ME) is 12.80%.

	Range	Selected
Cost of equity	20.90% - 24.30%	22.60%
Tax rate	24.60% - 27.00%	25.80%
Cost of debt	8.30% - 17.30%	12.80%
WACC	18.2% - 22.1%	20.1%

WACC

AKRN.ME WACC calculation

Category	Low	High

Long-term bond rate	15.8%	16.3%
Equity market risk premium	11.7%	12.7%
Adjusted beta	0.44	0.59

Additional risk adjustments	0.0%	0.5%
Cost of equity	20.90%	24.30%

Tax rate	24.60%	27.00%
Debt/Equity ratio	0.23	0.23
Cost of debt	8.30%	17.30%

After-tax WACC	18.2%	22.1%


Selected WACC	20.1%

AKRN.ME'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 AKRN.ME:

cost_of_equity (22.60%) = risk_free_rate (16.05%) + equity_risk_premium (12.20%) * adjusted_beta (0.44) + 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.