FI
Fiserv Inc
Price:  
163.44 
USD
Volume:  
2,957,692.00
United States | Financial Services
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FI WACC - Weighted Average Cost of Capital

The WACC of Fiserv Inc (FI) is 8.5%.

The Cost of Equity of Fiserv Inc (FI) is 9.80%.
The Cost of Debt of Fiserv Inc (FI) is 4.55%.

Range Selected
Cost of equity 8.30% - 11.30% 9.80%
Tax rate 18.00% - 19.10% 18.55%
Cost of debt 4.00% - 5.10% 4.55%
WACC 7.2% - 9.7% 8.5%
WACC

FI WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.97 1.14
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.30% 11.30%
Tax rate 18.00% 19.10%
Debt/Equity ratio 0.27 0.27
Cost of debt 4.00% 5.10%
After-tax WACC 7.2% 9.7%
Selected WACC 8.5%

FI'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 FI:

cost_of_equity (9.80%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.97) + 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.