IESC WACC - Weighted Average Cost of Capital
The WACC of IES Holdings Inc (IESC) is 8.7%.
| Range | Selected | |
| Cost of equity | 7.0% - 10.4% | 8.7% |
| Tax rate | 21.8% - 23.9% | 22.85% |
| Cost of debt | 4.5% - 13.7% | 9.1% |
| WACC | 7.0% - 10.4% | 8.7% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.68 | 0.99 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.0% | 10.4% |
| Tax rate | 21.8% | 23.9% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 4.5% | 13.7% |
| After-tax WACC | 7.0% | 10.4% |
| Selected WACC | 8.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| IESC | IES Holdings Inc | 0 | 2.22 | 2.21 |
| AEGN | Aegion Corp | 0.24 | 1.31 | 1.11 |
| AMRC | Ameresco Inc | 2.27 | 1.14 | 0.42 |
| ARE.TO | Aecon Group Inc | 0.39 | 0.77 | 0.59 |
| BDT.TO | Bird Construction Inc | 0.18 | 1.65 | 1.45 |
| DBMG | DBM Global Inc | 0.11 | 0.36 | 0.33 |
| GLDD | Great Lakes Dredge & Dock Corp | 0.61 | 1.33 | 0.91 |
| ORN | Orion Group Holdings Inc | 0.14 | 1.84 | 1.67 |
| ROAD | Construction Partners Inc | 0.09 | 1.57 | 1.47 |
| UGE.V | UGE International Ltd | 1.66 | -0.41 | -0.18 |
| WLMS | Williams Industrial Services Group Inc | 4.19 | -0.08 | -0.02 |
| Low | High | |
| Unlevered beta | 0.59 | 1.11 |
| Relevered beta | 0.52 | 0.99 |
| Adjusted relevered beta | 0.68 | 0.99 |
IESC'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 IESC:
cost_of_equity (8.70%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.68) + 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.