CGEN
Compugen Ltd
Price:  
1.76 
USD
Volume:  
94,601
Israel | Life Sciences Tools & Services

CGEN WACC - Weighted Average Cost of Capital

The WACC of Compugen Ltd (CGEN) is 6.9%.

The Cost of Equity of Compugen Ltd (CGEN) is 9.2%.
The Cost of Debt of Compugen Ltd (CGEN) is 5%.

RangeSelected
Cost of equity7.6% - 10.8%9.2%
Tax rate0.1% - 18.7%9.4%
Cost of debt5.0% - 5.0%5%
WACC6.3% - 7.4%6.9%
WACC

CGEN WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta0.821.06
Additional risk adjustments0.0%0.5%
Cost of equity7.6%10.8%
Tax rate0.1%18.7%
Debt/Equity ratio
11
Cost of debt5.0%5.0%
After-tax WACC6.3%7.4%
Selected WACC6.9%

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.