NML
Neuberger Berman Mlp and Energy Income Fund Inc
Price:  
8.94 
USD
Volume:  
220,666
United States | Finance and Insurance

NML WACC - Weighted Average Cost of Capital

The WACC of Neuberger Berman Mlp and Energy Income Fund Inc (NML) is 8.9%.

The Cost of Equity of Neuberger Berman Mlp and Energy Income Fund Inc (NML) is 9.9%.
The Cost of Debt of Neuberger Berman Mlp and Energy Income Fund Inc (NML) is 5.5%.

RangeSelected
Cost of equity8.8% - 11.0%9.9%
Tax rate26.2% - 27.0%26.6%
Cost of debt4.0% - 7.0%5.5%
WACC7.8% - 10.0%8.9%
WACC

NML WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta1.071.09
Additional risk adjustments0.0%0.5%
Cost of equity8.8%11.0%
Tax rate26.2%27.0%
Debt/Equity ratio
0.20.2
Cost of debt4.0%7.0%
After-tax WACC7.8%10.0%
Selected WACC8.9%

NML WACC - Detailed calculations of Beta

LowHigh
Unlevered beta0.971
Relevered beta1.11.13
Adjusted relevered beta1.071.09

NML'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 NML:

cost_of_equity (9.90%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.07) + 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.