POLY
Plantronics Inc
Price:  
39.82 
USD
Volume:  
192,389.00
United States | Communications Equipment
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POLY WACC - Weighted Average Cost of Capital

The WACC of Plantronics Inc (POLY) is 8.7%.

The Cost of Equity of Plantronics Inc (POLY) is 11.05%.
The Cost of Debt of Plantronics Inc (POLY) is 7.10%.

Range Selected
Cost of equity 9.50% - 12.60% 11.05%
Tax rate 14.70% - 20.20% 17.45%
Cost of debt 7.00% - 7.20% 7.10%
WACC 7.9% - 9.4% 8.7%
WACC

POLY WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.23 1.38
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.50% 12.60%
Tax rate 14.70% 20.20%
Debt/Equity ratio 0.86 0.86
Cost of debt 7.00% 7.20%
After-tax WACC 7.9% 9.4%
Selected WACC 8.7%

POLY'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 POLY:

cost_of_equity (11.05%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.23) + 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.