BRN
Barnwell Industries Inc
Price:  
1.34 
USD
Volume:  
8,012.00
United States | Oil, Gas & Consumable Fuels
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BRN WACC - Weighted Average Cost of Capital

The WACC of Barnwell Industries Inc (BRN) is 7.2%.

The Cost of Equity of Barnwell Industries Inc (BRN) is 9.55%.
The Cost of Debt of Barnwell Industries Inc (BRN) is 5.00%.

Range Selected
Cost of equity 7.20% - 11.90% 9.55%
Tax rate 4.30% - 4.80% 4.55%
Cost of debt 5.00% - 5.00% 5.00%
WACC 6.0% - 8.3% 7.2%
WACC

BRN WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.73 1.26
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.20% 11.90%
Tax rate 4.30% 4.80%
Debt/Equity ratio 1 1
Cost of debt 5.00% 5.00%
After-tax WACC 6.0% 8.3%
Selected WACC 7.2%

BRN'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 BRN:

cost_of_equity (9.55%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.73) + 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.