AWWI WACC - Weighted Average Cost of Capital
The WACC of Alpha Wastewater Inc (AWWI) is 3.9%.
| Range | Selected | |
| Cost of equity | 5.4% - 32.3% | 18.85% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 3.7% - 4.0% | 3.9% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.33 | 4.91 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.4% | 32.3% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 74.81 | 74.81 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 3.7% | 4.0% |
| Selected WACC | 3.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| AWWI | Alpha Wastewater Inc | 74.81 | -1.08 | -0.02 |
| AEPT | American Energy Partners Inc | 29.93 | 0.97 | 0.04 |
| ARVY | Alliance Recovery Corp | 0.19 | -0.56 | -0.49 |
| CMNR | Commerce Energy Group Inc | 0.29 | 0 | 0 |
| GNTW | Globe Net Wireless Corp | 0 | 1.78 | 1.78 |
| GTOO.CN | G2 Technologies Corp | 7.81 | -0.34 | -0.05 |
| MNTK | Montauk Renewables Inc | 0.18 | 1.62 | 1.43 |
| NUVI | Emo Capital Corp | 0.01 | 1.37 | 1.37 |
| SNPW | Sun Pacific Holding Corp | 3.68 | 0.9 | 0.24 |
| Low | High | |
| Unlevered beta | 0.01 | 0.2 |
| Relevered beta | 0 | 6.84 |
| Adjusted relevered beta | 0.33 | 4.91 |
AWWI'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 AWWI:
cost_of_equity (18.85%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.33) + 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.