ENPH
Enphase Energy Inc
Price:  
42.57 
USD
Volume:  
7,032,085.00
United States | Semiconductors & Semiconductor Equipment
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

ENPH WACC - Weighted Average Cost of Capital

The WACC of Enphase Energy Inc (ENPH) is 8.6%.

The Cost of Equity of Enphase Energy Inc (ENPH) is 9.75%.
The Cost of Debt of Enphase Energy Inc (ENPH) is 4.25%.

Range Selected
Cost of equity 8.10% - 11.40% 9.75%
Tax rate 13.60% - 14.50% 14.05%
Cost of debt 4.00% - 4.50% 4.25%
WACC 7.2% - 10.0% 8.6%
WACC

ENPH WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.92 1.17
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.10% 11.40%
Tax rate 13.60% 14.50%
Debt/Equity ratio 0.23 0.23
Cost of debt 4.00% 4.50%
After-tax WACC 7.2% 10.0%
Selected WACC 8.6%

ENPH'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 ENPH:

cost_of_equity (9.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.92) + 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.