IMBI WACC - Weighted Average Cost of Capital

The WACC of iMedia Brands Inc (IMBI) is 10.3%.

The Cost of Equity of iMedia Brands Inc (IMBI) is 206.55%.

The Cost of Debt of iMedia Brands Inc (IMBI) is 6.80%.

	Range	Selected
Cost of equity	166.70% - 246.40%	206.55%
Tax rate	0.40% - 0.50%	0.45%
Cost of debt	6.60% - 7.00%	6.80%
WACC	9.4% - 11.2%	10.3%

WACC

IMBI WACC calculation

Category	Low	High

Long-term bond rate	4.2%	4.7%
Equity market risk premium	5.0%	6.0%
Adjusted beta	32.51	40.21

Additional risk adjustments	0.0%	0.5%
Cost of equity	166.70%	246.40%

Tax rate	0.40%	0.50%
Debt/Equity ratio	55.57	55.57
Cost of debt	6.60%	7.00%

After-tax WACC	9.4%	11.2%


Selected WACC	10.3%

IMBI'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 IMBI:

cost_of_equity (206.55%) = risk_free_rate (4.45%) + equity_risk_premium (5.50%) * adjusted_beta (32.51) + 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.