CGEN WACC - Weighted Average Cost of Capital
The WACC of Compugen Ltd (CGEN) is 6.9%.
| Range | Selected | |
| Cost of equity | 7.6% - 10.8% | 9.2% |
| Tax rate | 0.1% - 18.7% | 9.4% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.3% - 7.4% | 6.9% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.82 | 1.06 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.6% | 10.8% |
| Tax rate | 0.1% | 18.7% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.3% | 7.4% |
| Selected WACC | 6.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| CGEN | Compugen Ltd | 0.85 | 1.57 | 0.85 |
| ARCH.V | Arch Biopartners Inc | 0.02 | 0.72 | 0.7 |
| CDXC | Chromadex Corp | 0 | 0.57 | 0.57 |
| CRL | Charles River Laboratories International Inc | 0.3 | 0.39 | 0.3 |
| EVIO | EVIO Inc | 595.18 | 0 | 0 |
| ICLR | ICON PLC | 0.3 | 0.69 | 0.53 |
| IQV | IQVIA Holdings Inc | 0.52 | 0.62 | 0.41 |
| PBIO | Pressure Biosciences Inc | 222.21 | -1.8 | -0.01 |
| PSNL | Personalis Inc | 0 | 1.14 | 1.13 |
| SLV.WA | Selvita SA | 0.41 | 0.94 | 0.67 |
| Low | High | |
| Unlevered beta | 0.48 | 0.61 |
| Relevered beta | 0.73 | 1.09 |
| Adjusted relevered beta | 0.82 | 1.06 |
CGEN'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 CGEN:
cost_of_equity (9.20%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.82) + 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.