ENV
Envestnet Inc
Price:  
63.14 
USD
Volume:  
5,144,807.00
United States | Software
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ENV WACC - Weighted Average Cost of Capital

The WACC of Envestnet Inc (ENV) is 7.3%.

The Cost of Equity of Envestnet Inc (ENV) is 8.45%.
The Cost of Debt of Envestnet Inc (ENV) is 4.65%.

Range Selected
Cost of equity 7.00% - 9.90% 8.45%
Tax rate 26.30% - 48.30% 37.30%
Cost of debt 4.00% - 5.30% 4.65%
WACC 6.2% - 8.5% 7.3%
WACC

ENV WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.69 0.9
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.00% 9.90%
Tax rate 26.30% 48.30%
Debt/Equity ratio 0.25 0.25
Cost of debt 4.00% 5.30%
After-tax WACC 6.2% 8.5%
Selected WACC 7.3%

ENV'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 ENV:

cost_of_equity (8.45%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.69) + 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.