IGT
International Game Technology PLC
Price:  
16.29 
USD
Volume:  
3,560,729
United Kingdom | Hotels, Restaurants & Leisure

IGT WACC - Weighted Average Cost of Capital

The WACC of International Game Technology PLC (IGT) is 5.5%.

The Cost of Equity of International Game Technology PLC (IGT) is 9.95%.
The Cost of Debt of International Game Technology PLC (IGT) is 5.05%.

RangeSelected
Cost of equity8.0% - 11.9%9.95%
Tax rate39.3% - 46.6%42.95%
Cost of debt4.5% - 5.6%5.05%
WACC4.7% - 6.3%5.5%
WACC

IGT WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta0.891.26
Additional risk adjustments0.0%0.5%
Cost of equity8.0%11.9%
Tax rate39.3%46.6%
Debt/Equity ratio
1.691.69
Cost of debt4.5%5.6%
After-tax WACC4.7%6.3%
Selected WACC5.5%

IGT'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 IGT:

cost_of_equity (9.95%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.89) + 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.