PKI WACC - Weighted Average Cost of Capital
The WACC of PerkinElmer Inc (PKI) is 7.9%.
| Range | Selected | |
| Cost of equity | 7.6% - 10.6% | 9.1% |
| Tax rate | 15.2% - 20.3% | 17.75% |
| Cost of debt | 4.0% - 5.1% | 4.55% |
| WACC | 6.6% - 9.1% | 7.9% |
| Category | Low | High |
| Long-term bond rate | 4.2% | 4.7% |
| Equity market risk premium | 4.2% | 5.2% |
| Adjusted beta | 0.79 | 1.03 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.6% | 10.6% |
| Tax rate | 15.2% | 20.3% |
| Debt/Equity ratio | 0.3 | 0.3 |
| Cost of debt | 4.0% | 5.1% |
| After-tax WACC | 6.6% | 9.1% |
| Selected WACC | 7.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PKI | PerkinElmer Inc | 0.3 | 1.21 | 0.98 |
| BIO | Bio Rad Laboratories Inc | 0.17 | 0.5 | 0.44 |
| BRKR | Bruker Corp | 0.37 | 0.99 | 0.76 |
| IPA.V | Immunoprecise Antibodies Ltd | 0.02 | -0.15 | -0.15 |
| LMNX | Luminex Corp | 0.12 | 0.57 | 0.52 |
| MRVI | Maravai LifeSciences Holdings Inc | 0.61 | 1.07 | 0.71 |
| QGEN | Qiagen NV | 0.15 | 0.59 | 0.52 |
| SONA.CN | Sona Nanotech Inc | 0.01 | 1.23 | 1.22 |
| TECH | Bio-Techne Corp | 0.04 | 0.79 | 0.77 |
| WAT | Waters Corp | 0.08 | 0.5 | 0.47 |
| Low | High | |
| Unlevered beta | 0.52 | 0.73 |
| Relevered beta | 0.69 | 1.04 |
| Adjusted relevered beta | 0.79 | 1.03 |
PKI'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 PKI:
cost_of_equity (9.10%) = risk_free_rate (4.45%) + equity_risk_premium (4.70%) * adjusted_beta (0.79) + 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.