CNST
Constellation Pharmaceuticals Inc
Price:  
33.99 
USD
Volume:  
792,950.00
United States | Biotechnology
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CNST WACC - Weighted Average Cost of Capital

The WACC of Constellation Pharmaceuticals Inc (CNST) is 4.6%.

The Cost of Equity of Constellation Pharmaceuticals Inc (CNST) is 5.50%.
The Cost of Debt of Constellation Pharmaceuticals Inc (CNST) is 5.00%.

Range Selected
Cost of equity 4.70% - 6.30% 5.50%
Tax rate 27.00% - 27.00% 27.00%
Cost of debt 5.00% - 5.00% 5.00%
WACC 4.2% - 5.0% 4.6%
WACC

CNST WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 4.2% 5.2%
Adjusted beta 0.36 0.4
Additional risk adjustments 0.0% 0.5%
Cost of equity 4.70% 6.30%
Tax rate 27.00% 27.00%
Debt/Equity ratio 1 1
Cost of debt 5.00% 5.00%
After-tax WACC 4.2% 5.0%
Selected WACC 4.6%

CNST'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 CNST:

cost_of_equity (5.50%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * adjusted_beta (0.36) + 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.