IDEA
Aeon Ventures Inc
Price:  
0.01 
USD
Volume:  
9,830.00
United States | Capital Markets
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IDEA WACC - Weighted Average Cost of Capital

The WACC of Aeon Ventures Inc (IDEA) is 5.7%.

The Cost of Equity of Aeon Ventures Inc (IDEA) is 6.05%.
The Cost of Debt of Aeon Ventures Inc (IDEA) is 5.00%.

Range Selected
Cost of equity 5.40% - 6.70% 6.05%
Tax rate 0.30% - 2.00% 1.15%
Cost of debt 5.00% - 5.00% 5.00%
WACC 5.3% - 6.2% 5.7%
WACC

IDEA WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.33 0.33
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.40% 6.70%
Tax rate 0.30% 2.00%
Debt/Equity ratio 0.42 0.42
Cost of debt 5.00% 5.00%
After-tax WACC 5.3% 6.2%
Selected WACC 5.7%

IDEA'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 IDEA:

cost_of_equity (6.05%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.33) + 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.