DEA
Easterly Government Properties Inc
Price:  
22.75 
USD
Volume:  
212,292
United States | Equity Real Estate Investment Trusts (REITs)

DEA WACC - Weighted Average Cost of Capital

The WACC of Easterly Government Properties Inc (DEA) is 6.7%.

The Cost of Equity of Easterly Government Properties Inc (DEA) is 7.9%.
The Cost of Debt of Easterly Government Properties Inc (DEA) is 8.2%.

RangeSelected
Cost of equity6.8% - 9.0%7.9%
Tax rate26.2% - 27.0%26.6%
Cost of debt4.0% - 12.4%8.2%
WACC4.4% - 9.0%6.7%
WACC

DEA WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta0.630.73
Additional risk adjustments0.0%0.5%
Cost of equity6.8%9.0%
Tax rate26.2%27.0%
Debt/Equity ratio
1.571.57
Cost of debt4.0%12.4%
After-tax WACC4.4%9.0%
Selected WACC6.7%

DEA'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 DEA:

cost_of_equity (7.90%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.63) + 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.