Arcimoto WACC - Weighted Average Cost of Capital
The WACC of Arcimoto Inc (FUV) is 6.5%.
| Range | Selected | |
| Cost of equity | 6.6% - 12.1% | 9.35% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 7.0% - 8.7% | 7.85% |
| WACC | 5.5% - 7.6% | 6.5% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.59 | 1.29 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.6% | 12.1% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 3.67 | 3.67 |
| Cost of debt | 7.0% | 8.7% |
| After-tax WACC | 5.5% | 7.6% |
| Selected WACC | 6.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| FUV | Arcimoto Inc | 3.67 | 1.35 | 0.37 |
| ELCR | Electric Car Company Inc | 87.26 | 0 | 0 |
| FSR | Fisker Inc | 9.59 | 0.95 | 0.12 |
| HOG | Harley-Davidson Inc | 2.38 | 0.65 | 0.24 |
| NIU | NIU Technologies | 0.14 | 1.18 | 1.07 |
| OTLK | Outlook Therapeutics Inc | 0.71 | 0.44 | 0.29 |
| EMC.MI | Energica Motor Company SpA | 0.03 | 1.12 | 1.09 |
| EVA.MI | Askoll Eva SpA | 1.3 | 0.76 | 0.39 |
| IMS.MI | Immsi SpA | 6.76 | 0.57 | 0.1 |
| PIA.MI | Piaggio & C SpA | 1.17 | 0.66 | 0.35 |
| Low | High | |
| Unlevered beta | 0.27 | 0.36 |
| Relevered beta | 0.39 | 1.43 |
| Adjusted relevered beta | 0.59 | 1.29 |
Arcimoto'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 Arcimoto:
cost_of_equity (9.35%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.59) + 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.