INO WACC - Weighted Average Cost of Capital
The WACC of Inovio Pharmaceuticals Inc (INO) is 6.4%.
| Range | Selected | |
| Cost of equity | 7.4% - 10.9% | 9.15% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 4.5% - 5.6% | 5.05% |
| WACC | 5.3% - 7.5% | 6.4% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.76 | 1.07 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.4% | 10.9% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 4.5% | 5.6% |
| After-tax WACC | 5.3% | 7.5% |
| Selected WACC | 6.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| INO | Inovio Pharmaceuticals Inc | 1.03 | 1.66 | 0.95 |
| ABBV | Abbvie Inc | 0.21 | 0.33 | 0.29 |
| ALEC | Alector Inc | 0.08 | 2.02 | 1.91 |
| AMGN | Amgen Inc | 0.41 | 0.38 | 0.29 |
| AMTI | Applied Molecular Transport Inc. | 0.05 | 0.47 | 0.45 |
| CYTK | Cytokinetics Inc | 0.18 | 1.04 | 0.92 |
| DMTK | DermTech Inc | 0.03 | 2.09 | 2.05 |
| GILD | Gilead Sciences Inc | 0.2 | 0.38 | 0.33 |
| KURA | Kura Oncology Inc | 0.02 | 1.37 | 1.35 |
| PRLD | Prelude Therapeutics Inc | 0 | 0.41 | 0.41 |
| VBIV | VBI Vaccines Inc | 13.32 | 1.21 | 0.11 |
| Low | High | |
| Unlevered beta | 0.41 | 0.92 |
| Relevered beta | 0.64 | 1.1 |
| Adjusted relevered beta | 0.76 | 1.07 |
INO'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 INO:
cost_of_equity (9.15%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.76) + 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.