AQUA
Evoqua Water Technologies Corp
Price:  
49.88 
USD
Volume:  
31,357,900.00
United States | Machinery
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AQUA WACC - Weighted Average Cost of Capital

The WACC of Evoqua Water Technologies Corp (AQUA) is 8.2%.

The Cost of Equity of Evoqua Water Technologies Corp (AQUA) is 8.95%.
The Cost of Debt of Evoqua Water Technologies Corp (AQUA) is 4.80%.

Range Selected
Cost of equity 7.60% - 10.30% 8.95%
Tax rate 13.10% - 32.10% 22.60%
Cost of debt 4.00% - 5.60% 4.80%
WACC 7.0% - 9.4% 8.2%
WACC

AQUA WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.8 0.97
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.60% 10.30%
Tax rate 13.10% 32.10%
Debt/Equity ratio 0.15 0.15
Cost of debt 4.00% 5.60%
After-tax WACC 7.0% 9.4%
Selected WACC 8.2%

AQUA'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 AQUA:

cost_of_equity (8.95%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.8) + 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.