EQBK
Equity Bancshares Inc
Price:  
39.79 
USD
Volume:  
50,685.00
United States | Banks
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EQBK WACC - Weighted Average Cost of Capital

The WACC of Equity Bancshares Inc (EQBK) is 8.7%.

The Cost of Equity of Equity Bancshares Inc (EQBK) is 9.60%.
The Cost of Debt of Equity Bancshares Inc (EQBK) is 5.00%.

Range Selected
Cost of equity 8.50% - 10.70% 9.60%
Tax rate 18.30% - 19.20% 18.75%
Cost of debt 5.00% - 5.00% 5.00%
WACC 7.8% - 9.6% 8.7%
WACC

EQBK 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 1.04
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.50% 10.70%
Tax rate 18.30% 19.20%
Debt/Equity ratio 0.19 0.19
Cost of debt 5.00% 5.00%
After-tax WACC 7.8% 9.6%
Selected WACC 8.7%

EQBK'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 EQBK:

cost_of_equity (9.60%) = 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.