CHX
ChampionX Corp
Price:  
24.96 
USD
Volume:  
2,684,581.00
United States | Energy Equipment & Services
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CHX WACC - Weighted Average Cost of Capital

The WACC of ChampionX Corp (CHX) is 9.2%.

The Cost of Equity of ChampionX Corp (CHX) is 9.90%.
The Cost of Debt of ChampionX Corp (CHX) is 5.90%.

Range Selected
Cost of equity 8.70% - 11.10% 9.90%
Tax rate 23.10% - 24.90% 24.00%
Cost of debt 4.60% - 7.20% 5.90%
WACC 8.1% - 10.4% 9.2%
WACC

CHX WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.05 1.11
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.70% 11.10%
Tax rate 23.10% 24.90%
Debt/Equity ratio 0.14 0.14
Cost of debt 4.60% 7.20%
After-tax WACC 8.1% 10.4%
Selected WACC 9.2%

CHX'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 CHX:

cost_of_equity (9.90%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.05) + 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.