CBOE
Cboe Global Markets Inc
Price:  
226.39 
USD
Volume:  
1,370,937.00
United States | Capital Markets
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CBOE WACC - Weighted Average Cost of Capital

The WACC of Cboe Global Markets Inc (CBOE) is 7.6%.

The Cost of Equity of Cboe Global Markets Inc (CBOE) is 7.85%.
The Cost of Debt of Cboe Global Markets Inc (CBOE) is 4.50%.

Range Selected
Cost of equity 6.50% - 9.20% 7.85%
Tax rate 29.30% - 29.70% 29.50%
Cost of debt 4.40% - 4.60% 4.50%
WACC 6.3% - 8.8% 7.6%
WACC

CBOE WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.58 0.77
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.50% 9.20%
Tax rate 29.30% 29.70%
Debt/Equity ratio 0.06 0.06
Cost of debt 4.40% 4.60%
After-tax WACC 6.3% 8.8%
Selected WACC 7.6%

CBOE'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 CBOE:

cost_of_equity (7.85%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.58) + 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.