CMBM WACC - Weighted Average Cost of Capital

The WACC of Cambium Networks Corp (CMBM) is 8.6%.

The Cost of Equity of Cambium Networks Corp (CMBM) is 10.50%.

The Cost of Debt of Cambium Networks Corp (CMBM) is 5.95%.

	Range	Selected
Cost of equity	9.20% - 11.80%	10.50%
Tax rate	15.20% - 19.00%	17.10%
Cost of debt	4.90% - 7.00%	5.95%
WACC	7.5% - 9.8%	8.6%

WACC

CMBM WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	1.15	1.25

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.20%	11.80%

Tax rate	15.20%	19.00%
Debt/Equity ratio	0.51	0.51
Cost of debt	4.90%	7.00%

After-tax WACC	7.5%	9.8%


Selected WACC	8.6%

CMBM'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 CMBM:

cost_of_equity (10.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.15) + 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.