FENG
Phoenix New Media Ltd
Price:  
2.11 
USD
Volume:  
2,961.00
China | Interactive Media & Services
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FENG WACC - Weighted Average Cost of Capital

The WACC of Phoenix New Media Ltd (FENG) is 6.1%.

The Cost of Equity of Phoenix New Media Ltd (FENG) is 7.70%.
The Cost of Debt of Phoenix New Media Ltd (FENG) is 5.00%.

Range Selected
Cost of equity 5.50% - 9.90% 7.70%
Tax rate 6.60% - 16.90% 11.75%
Cost of debt 5.00% - 5.00% 5.00%
WACC 5.1% - 7.0% 6.1%
WACC

FENG WACC calculation

Category Low High
Long-term bond rate 2.6% 3.1%
Equity market risk premium 4.2% 5.2%
Adjusted beta 0.34 0.93
Additional risk adjustments 1.5% 2.0%
Cost of equity 5.50% 9.90%
Tax rate 6.60% 16.90%
Debt/Equity ratio 1 1
Cost of debt 5.00% 5.00%
After-tax WACC 5.1% 7.0%
Selected WACC 6.1%

FENG'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 FENG:

cost_of_equity (7.70%) = risk_free_rate (2.85%) + equity_risk_premium (4.70%) * adjusted_beta (0.34) + risk_adjustments (1.75%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.