PRVA
Privia Health Group Inc
Price:  
25.07 
USD
Volume:  
1,443,591.00
United States | Health Care Providers & Services
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PRVA WACC - Weighted Average Cost of Capital

The WACC of Privia Health Group Inc (PRVA) is 5.6%.

The Cost of Equity of Privia Health Group Inc (PRVA) is 8.05%.
The Cost of Debt of Privia Health Group Inc (PRVA) is 4.50%.

Range Selected
Cost of equity 6.90% - 9.20% 8.05%
Tax rate 29.90% - 32.90% 31.40%
Cost of debt 4.50% - 4.50% 4.50%
WACC 5.0% - 6.1% 5.6%
WACC

PRVA WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.67 0.78
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.90% 9.20%
Tax rate 29.90% 32.90%
Debt/Equity ratio 1 1
Cost of debt 4.50% 4.50%
After-tax WACC 5.0% 6.1%
Selected WACC 5.6%

PRVA'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 PRVA:

cost_of_equity (8.05%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.67) + 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.