DMB
BNY Mellon Municipal Bond Infrastructure Fund Inc
Price:  
10.19 
USD
Volume:  
84,434.00
United States | N/A
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DMB WACC - Weighted Average Cost of Capital

The WACC of BNY Mellon Municipal Bond Infrastructure Fund Inc (DMB) is 8.2%.

The Cost of Equity of BNY Mellon Municipal Bond Infrastructure Fund Inc (DMB) is 9.95%.
The Cost of Debt of BNY Mellon Municipal Bond Infrastructure Fund Inc (DMB) is 5.00%.

Range Selected
Cost of equity 8.50% - 11.40% 9.95%
Tax rate 26.20% - 27.00% 26.60%
Cost of debt 5.00% - 5.00% 5.00%
WACC 7.1% - 9.2% 8.2%
WACC

DMB WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.01 1.17
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.50% 11.40%
Tax rate 26.20% 27.00%
Debt/Equity ratio 0.4 0.4
Cost of debt 5.00% 5.00%
After-tax WACC 7.1% 9.2%
Selected WACC 8.2%

DMB'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 DMB:

cost_of_equity (9.95%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.01) + 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.