DEA
Easterly Government Properties Inc
Price:  
21.18 
USD
Volume:  
833,810.00
United States | Equity Real Estate Investment Trusts (REITs)
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DEA WACC - Weighted Average Cost of Capital

The WACC of Easterly Government Properties Inc (DEA) is 6.6%.

The Cost of Equity of Easterly Government Properties Inc (DEA) is 7.70%.
The Cost of Debt of Easterly Government Properties Inc (DEA) is 8.20%.

Range Selected
Cost of equity 6.60% - 8.80% 7.70%
Tax rate 26.20% - 27.00% 26.60%
Cost of debt 4.00% - 12.40% 8.20%
WACC 4.3% - 9.0% 6.6%
WACC

DEA WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.6 0.71
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.60% 8.80%
Tax rate 26.20% 27.00%
Debt/Equity ratio 1.68 1.68
Cost of debt 4.00% 12.40%
After-tax WACC 4.3% 9.0%
Selected WACC 6.6%

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 (7.70%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.6) + 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.