NES
Nuverra Environmental Solutions Inc
Price:  
2.15 
USD
Volume:  
248,018.00
United States | Energy Equipment & Services
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NES WACC - Weighted Average Cost of Capital

The WACC of Nuverra Environmental Solutions Inc (NES) is 7.3%.

The Cost of Equity of Nuverra Environmental Solutions Inc (NES) is 7.45%.
The Cost of Debt of Nuverra Environmental Solutions Inc (NES) is 7.10%.

Range Selected
Cost of equity 5.30% - 9.60% 7.45%
Tax rate 0.30% - 0.40% 0.35%
Cost of debt 7.00% - 7.20% 7.10%
WACC 6.1% - 8.4% 7.3%
WACC

NES WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 4.2% 5.2%
Adjusted beta 0.38 0.94
Additional risk adjustments 0.5% 1.0%
Cost of equity 5.30% 9.60%
Tax rate 0.30% 0.40%
Debt/Equity ratio 0.99 0.99
Cost of debt 7.00% 7.20%
After-tax WACC 6.1% 8.4%
Selected WACC 7.3%

NES'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 NES:

cost_of_equity (7.45%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * adjusted_beta (0.38) + risk_adjustments (0.75%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.