BE WACC - Weighted Average Cost of Capital

The WACC of Bloom Energy Corp (BE) is 7.4%.

The Cost of Equity of Bloom Energy Corp (BE) is 7.50%.

The Cost of Debt of Bloom Energy Corp (BE) is 6.85%.

	Range	Selected
Cost of equity	6.50% - 8.50%	7.50%
Tax rate	0.60% - 1.70%	1.15%
Cost of debt	4.60% - 9.10%	6.85%
WACC	6.4% - 8.5%	7.4%

WACC

BE WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	0.57	0.65

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.50%	8.50%

Tax rate	0.60%	1.70%
Debt/Equity ratio	0.08	0.08
Cost of debt	4.60%	9.10%

After-tax WACC	6.4%	8.5%


Selected WACC	7.4%

BE'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 BE:

cost_of_equity (7.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.57) + 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.