EYE
National Vision Holdings Inc
Price:  
19.24 
USD
Volume:  
2,846,556.00
United States | Specialty Retail
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EYE WACC - Weighted Average Cost of Capital

The WACC of National Vision Holdings Inc (EYE) is 8.0%.

The Cost of Equity of National Vision Holdings Inc (EYE) is 8.80%.
The Cost of Debt of National Vision Holdings Inc (EYE) is 5.75%.

Range Selected
Cost of equity 7.60% - 10.00% 8.80%
Tax rate 11.00% - 20.80% 15.90%
Cost of debt 4.00% - 7.50% 5.75%
WACC 6.9% - 9.2% 8.0%
WACC

EYE 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 0.91
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.60% 10.00%
Tax rate 11.00% 20.80%
Debt/Equity ratio 0.23 0.23
Cost of debt 4.00% 7.50%
After-tax WACC 6.9% 9.2%
Selected WACC 8.0%

EYE'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 EYE:

cost_of_equity (8.80%) = 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.