BDCO
Blue Dolphin Energy Co
Price:  
1.21 
USD
Volume:  
3,420
United States | Oil, Gas & Consumable Fuels

BDCO WACC - Weighted Average Cost of Capital

The WACC of Blue Dolphin Energy Co (BDCO) is 8.3%.

The Cost of Equity of Blue Dolphin Energy Co (BDCO) is 6.1%.
The Cost of Debt of Blue Dolphin Energy Co (BDCO) is 9.45%.

RangeSelected
Cost of equity5.3% - 6.9%6.1%
Tax rate0.6% - 1.2%0.9%
Cost of debt7.0% - 11.9%9.45%
WACC6.4% - 10.3%8.3%
WACC

BDCO WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta0.310.37
Additional risk adjustments0.0%0.5%
Cost of equity5.3%6.9%
Tax rate0.6%1.2%
Debt/Equity ratio
2.182.18
Cost of debt7.0%11.9%
After-tax WACC6.4%10.3%
Selected WACC8.3%

BDCO'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 BDCO:

cost_of_equity (6.10%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.31) + 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.