The WACC of Intelsat SA (INTEQ) is 12.9%.
| Range | Selected | |
| Cost of equity | 942.20% - 2,293.70% | 1,617.95% |
| Tax rate | 1.30% - 12.10% | 6.70% |
| Cost of debt | 6.50% - 20.60% | 13.55% |
| WACC | 6.8% - 19.0% | 12.9% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 4.2% | 5.2% |
| Adjusted beta | 221.47 | 436.94 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 942.20% | 2,293.70% |
| Tax rate | 1.30% | 12.10% |
| Debt/Equity ratio | 2643.91 | 2643.91 |
| Cost of debt | 6.50% | 20.60% |
| After-tax WACC | 6.8% | 19.0% |
| Selected WACC | 12.9% | |
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 INTEQ:
cost_of_equity (1,617.95%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * adjusted_beta (221.47) + 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.