CSOD
Cornerstone OnDemand Inc
Price:  
57.49 
USD
Volume:  
3,801,070.00
United States | Software
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CSOD WACC - Weighted Average Cost of Capital

The WACC of Cornerstone OnDemand Inc (CSOD) is 8.2%.

The Cost of Equity of Cornerstone OnDemand Inc (CSOD) is 8.40%.
The Cost of Debt of Cornerstone OnDemand Inc (CSOD) is 9.85%.

Range Selected
Cost of equity 6.90% - 9.90% 8.40%
Tax rate 9.70% - 29.30% 19.50%
Cost of debt 6.60% - 13.10% 9.85%
WACC 6.7% - 9.7% 8.2%
WACC

CSOD WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 4.2% 5.2%
Adjusted beta 0.87 1.09
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.90% 9.90%
Tax rate 9.70% 29.30%
Debt/Equity ratio 0.31 0.31
Cost of debt 6.60% 13.10%
After-tax WACC 6.7% 9.7%
Selected WACC 8.2%

CSOD'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 CSOD:

cost_of_equity (8.40%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * adjusted_beta (0.87) + 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.