BDN
Brandywine Realty Trust
Price:  
4.12 
USD
Volume:  
1,771,977.00
United States | Equity Real Estate Investment Trusts (REITs)
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BDN WACC - Weighted Average Cost of Capital

The WACC of Brandywine Realty Trust (BDN) is 11.7%.

The Cost of Equity of Brandywine Realty Trust (BDN) is 7.65%.
The Cost of Debt of Brandywine Realty Trust (BDN) is 13.00%.

Range Selected
Cost of equity 5.70% - 9.60% 7.65%
Tax rate -% - -% -%
Cost of debt 5.10% - 20.90% 13.00%
WACC 5.2% - 18.2% 11.7%
WACC

BDN WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.4 0.85
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.70% 9.60%
Tax rate -% -%
Debt/Equity ratio 3.15 3.15
Cost of debt 5.10% 20.90%
After-tax WACC 5.2% 18.2%
Selected WACC 11.7%

BDN'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 BDN:

cost_of_equity (7.65%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.4) + 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.