EXPI
eXp World Holdings Inc
Price:  
8.93 
USD
Volume:  
908,273.00
United States | Real Estate Management & Development
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EXPI WACC - Weighted Average Cost of Capital

The WACC of eXp World Holdings Inc (EXPI) is 6.6%.

The Cost of Equity of eXp World Holdings Inc (EXPI) is 9.55%.
The Cost of Debt of eXp World Holdings Inc (EXPI) is 5.00%.

Range Selected
Cost of equity 7.60% - 11.50% 9.55%
Tax rate 26.20% - 27.00% 26.60%
Cost of debt 5.00% - 5.00% 5.00%
WACC 5.7% - 7.6% 6.6%
WACC

EXPI WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.82 1.19
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.60% 11.50%
Tax rate 26.20% 27.00%
Debt/Equity ratio 1 1
Cost of debt 5.00% 5.00%
After-tax WACC 5.7% 7.6%
Selected WACC 6.6%

EXPI'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 EXPI:

cost_of_equity (9.55%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.82) + 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.