Antero WACC - Weighted Average Cost of Capital

The WACC of Antero Midstream Corp (AM) is 7.3%.

The Cost of Equity of Antero Midstream Corp (AM) is 8.40%.

The Cost of Debt of Antero Midstream Corp (AM) is 6.05%.

	Range	Selected
Cost of equity	7.40% - 9.40%	8.40%
Tax rate	26.30% - 26.70%	26.50%
Cost of debt	6.00% - 6.10%	6.05%
WACC	6.6% - 8.1%	7.3%

WACC

Antero WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	0.76	0.8

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.40%	9.40%

Tax rate	26.30%	26.70%
Debt/Equity ratio	0.35	0.35
Cost of debt	6.00%	6.10%

After-tax WACC	6.6%	8.1%


Selected WACC	7.3%

Antero'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 Antero:

cost_of_equity (8.40%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.76) + 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.