ONEM WACC - Weighted Average Cost of Capital
The WACC of 1Life Healthcare Inc (ONEM) is 9.0%.
| Range | Selected | |
| Cost of equity | 6.1% - 8.9% | 7.5% |
| Tax rate | 0.2% - 0.2% | 0.2% |
| Cost of debt | 7.0% - 43.7% | 25.35% |
| WACC | 6.2% - 11.8% | 9.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.48 | 0.72 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.1% | 8.9% |
| Tax rate | 0.2% | 0.2% |
| Debt/Equity ratio | 0.09 | 0.09 |
| Cost of debt | 7.0% | 43.7% |
| After-tax WACC | 6.2% | 11.8% |
| Selected WACC | 9.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ONEM | 1Life Healthcare Inc | 0.09 | 0.98 | 0.9 |
| ADUS | Addus Homecare Corp | 0.11 | 0.31 | 0.28 |
| AKU.TO | Akumin Inc | 1.94 | 0.95 | 0.32 |
| AMEH | Apollo Medical Holdings Inc | 0.11 | 1.21 | 1.1 |
| BDSX | Biodesix, Inc. | 0.92 | 0.27 | 0.14 |
| CCEL | Cryo-Cell International Inc | 0.21 | -0.13 | -0.1 |
| NLH.V | Nova Leap Health Corp | 0.14 | 0.03 | 0.02 |
| SGFY | Signify Health Inc | 0.05 | 1.03 | 0.99 |
| STRR | Star Equity Holdings Inc | 1.81 | 0.69 | 0.25 |
| WELL.TO | WELL Health Technologies Corp | 0.44 | 1.83 | 1.27 |
| Low | High | |
| Unlevered beta | 0.27 | 0.55 |
| Relevered beta | 0.22 | 0.58 |
| Adjusted relevered beta | 0.48 | 0.72 |
ONEM'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 ONEM:
cost_of_equity (7.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.48) + 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.