CGNT
Cognyte Software Ltd
Price:  
9.90 
USD
Volume:  
175,072.00
Israel | Software
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CGNT WACC - Weighted Average Cost of Capital

The WACC of Cognyte Software Ltd (CGNT) is 7.9%.

The Cost of Equity of Cognyte Software Ltd (CGNT) is 7.85%.
The Cost of Debt of Cognyte Software Ltd (CGNT) is 7.00%.

Range Selected
Cost of equity 6.70% - 9.00% 7.85%
Tax rate 16.00% - 36.90% 26.45%
Cost of debt 7.00% - 7.00% 7.00%
WACC 6.7% - 9.0% 7.9%
WACC

CGNT WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.61 0.74
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.70% 9.00%
Tax rate 16.00% 36.90%
Debt/Equity ratio 0 0
Cost of debt 7.00% 7.00%
After-tax WACC 6.7% 9.0%
Selected WACC 7.9%

CGNT'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 CGNT:

cost_of_equity (7.85%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.61) + 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.