MPLN WACC - Weighted Average Cost of Capital
The WACC of Multiplan Corp (MPLN) is 13.7%.
| Range | Selected | |
| Cost of equity | 5.7% - 23.8% | 14.75% |
| Tax rate | 6.2% - 10.0% | 8.1% |
| Cost of debt | 6.2% - 23.9% | 15.05% |
| WACC | 5.8% - 21.7% | 13.7% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.4 | 3.39 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.7% | 23.8% |
| Tax rate | 6.2% | 10.0% |
| Debt/Equity ratio | 12.06 | 12.06 |
| Cost of debt | 6.2% | 23.9% |
| After-tax WACC | 5.8% | 21.7% |
| Selected WACC | 13.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MPLN | Multiplan Corp | 12.06 | 2.05 | 0.17 |
| APYI | Aspyra Inc | 0.53 | 0.2 | 0.13 |
| CERT | Certara Inc | 0.16 | 1.24 | 1.08 |
| HCAT | Health Catalyst Inc | 1.49 | 0.98 | 0.41 |
| MITI | Mitesco Inc | 0.38 | -1.16 | -0.86 |
| MLKNA | MedLink International Inc | 0.45 | 1.22 | 0.86 |
| NH | NantHealth Inc | 29.54 | 0.4 | 0.01 |
| OMCL | Omnicell Inc | 0.26 | 0.15 | 0.12 |
| PHR | Phreesia Inc | 0.01 | 0.95 | 0.94 |
| TRHC | Tabula Rasa HealthCare Inc | 1.13 | 1.4 | 0.68 |
| Low | High | |
| Unlevered beta | 0.15 | 0.52 |
| Relevered beta | 0.1 | 4.57 |
| Adjusted relevered beta | 0.4 | 3.39 |
MPLN'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 MPLN:
cost_of_equity (14.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.4) + 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.