CNNE
Cannae Holdings Inc
Price:  
18.48 
USD
Volume:  
312,406.00
United States | Diversified Financial Services
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CNNE WACC - Weighted Average Cost of Capital

The WACC of Cannae Holdings Inc (CNNE) is 7.1%.

The Cost of Equity of Cannae Holdings Inc (CNNE) is 6.45%.
The Cost of Debt of Cannae Holdings Inc (CNNE) is 14.70%.

Range Selected
Cost of equity 5.40% - 7.50% 6.45%
Tax rate 20.10% - 23.90% 22.00%
Cost of debt 7.00% - 22.40% 14.70%
WACC 5.4% - 8.8% 7.1%
WACC

CNNE WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.32 0.47
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.40% 7.50%
Tax rate 20.10% 23.90%
Debt/Equity ratio 0.16 0.16
Cost of debt 7.00% 22.40%
After-tax WACC 5.4% 8.8%
Selected WACC 7.1%

CNNE'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 CNNE:

cost_of_equity (6.45%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.32) + 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.