ISIG
Insignia Systems Inc
Price:  
7.73 
USD
Volume:  
11,390.00
United States | Media
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ISIG WACC - Weighted Average Cost of Capital

The WACC of Insignia Systems Inc (ISIG) is 8.6%.

The Cost of Equity of Insignia Systems Inc (ISIG) is 12.35%.
The Cost of Debt of Insignia Systems Inc (ISIG) is 5.00%.

Range Selected
Cost of equity 10.60% - 14.10% 12.35%
Tax rate 2.00% - 2.60% 2.30%
Cost of debt 5.00% - 5.00% 5.00%
WACC 7.8% - 9.5% 8.6%
WACC

ISIG WACC calculation

Category Low High
Long-term bond rate 4.2% 4.7%
Equity market risk premium 5.0% 6.0%
Adjusted beta 1.29 1.48
Additional risk adjustments 0.0% 0.5%
Cost of equity 10.60% 14.10%
Tax rate 2.00% 2.60%
Debt/Equity ratio 1 1
Cost of debt 5.00% 5.00%
After-tax WACC 7.8% 9.5%
Selected WACC 8.6%

ISIG'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 ISIG:

cost_of_equity (12.35%) = risk_free_rate (4.45%) + equity_risk_premium (5.50%) * adjusted_beta (1.29) + 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.