PLUG
Plug Power Inc
Price:  
1.14 
USD
Volume:  
50,994,360.00
United States | Electrical Equipment
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PLUG WACC - Weighted Average Cost of Capital

The WACC of Plug Power Inc (PLUG) is 7.9%.

The Cost of Equity of Plug Power Inc (PLUG) is 9.00%.
The Cost of Debt of Plug Power Inc (PLUG) is 6.60%.

Range Selected
Cost of equity 7.80% - 10.20% 9.00%
Tax rate 0.40% - 1.70% 1.05%
Cost of debt 6.20% - 7.00% 6.60%
WACC 7.1% - 8.7% 7.9%
WACC

PLUG WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.85 0.96
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.80% 10.20%
Tax rate 0.40% 1.70%
Debt/Equity ratio 0.81 0.81
Cost of debt 6.20% 7.00%
After-tax WACC 7.1% 8.7%
Selected WACC 7.9%

PLUG'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 PLUG:

cost_of_equity (9.00%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.85) + 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.