RNGR
Ranger Energy Services Inc
Price:  
14.13 
USD
Volume:  
141,935.00
United States | Energy Equipment & Services
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RNGR WACC - Weighted Average Cost of Capital

The WACC of Ranger Energy Services Inc (RNGR) is 8.2%.

The Cost of Equity of Ranger Energy Services Inc (RNGR) is 8.65%.
The Cost of Debt of Ranger Energy Services Inc (RNGR) is 4.55%.

Range Selected
Cost of equity 7.50% - 9.80% 8.65%
Tax rate 16.20% - 25.60% 20.90%
Cost of debt 4.50% - 4.60% 4.55%
WACC 7.2% - 9.3% 8.2%
WACC

RNGR WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.79 0.88
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.50% 9.80%
Tax rate 16.20% 25.60%
Debt/Equity ratio 0.09 0.09
Cost of debt 4.50% 4.60%
After-tax WACC 7.2% 9.3%
Selected WACC 8.2%

RNGR'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 RNGR:

cost_of_equity (8.65%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * 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.