MAHN WACC - Weighted Average Cost of Capital

The WACC of Mid Atlantic Home Health Network Inc (MAHN) is 10.7%.

The Cost of Equity of Mid Atlantic Home Health Network Inc (MAHN) is 9.90%.

The Cost of Debt of Mid Atlantic Home Health Network Inc (MAHN) is 15.85%.

	Range	Selected
Cost of equity	6.90% - 12.90%	9.90%
Tax rate	27.90% - 33.80%	30.85%
Cost of debt	15.60% - 16.10%	15.85%
WACC	10.2% - 11.2%	10.7%

WACC

MAHN WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	0.65	1.44

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.90%	12.90%

Tax rate	27.90%	33.80%
Debt/Equity ratio	2.96	2.96
Cost of debt	15.60%	16.10%

After-tax WACC	10.2%	11.2%


Selected WACC	10.7%

MAHN'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 MAHN:

cost_of_equity (9.90%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.65) + 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.