ATNX
Athenex Inc
Price:  
0.20 
USD
Volume:  
1,880,200.00
United States | Biotechnology
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Athenex WACC - Weighted Average Cost of Capital

The WACC of Athenex Inc (ATNX) is 8.9%.

The Cost of Equity of Athenex Inc (ATNX) is 40.95%.
The Cost of Debt of Athenex Inc (ATNX) is 8.75%.

Range Selected
Cost of equity 14.20% - 67.70% 40.95%
Tax rate 2.40% - 3.60% 3.00%
Cost of debt 7.00% - 10.50% 8.75%
WACC 6.9% - 11.0% 8.9%
WACC

Athenex WACC calculation

Category Low High
Long-term bond rate 4.2% 4.7%
Equity market risk premium 5.0% 6.0%
Adjusted beta 2 10.42
Additional risk adjustments 0.0% 0.5%
Cost of equity 14.20% 67.70%
Tax rate 2.40% 3.60%
Debt/Equity ratio 70.45 70.45
Cost of debt 7.00% 10.50%
After-tax WACC 6.9% 11.0%
Selected WACC 8.9%

Athenex'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 Athenex:

cost_of_equity (40.95%) = risk_free_rate (4.45%) + equity_risk_premium (5.50%) * adjusted_beta (2) + 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.