SOEN WACC - Weighted Average Cost of Capital
The WACC of Solar EnerTech Corp (SOEN) is 69.9%.
| Range | Selected | |
| Cost of equity | 66.0% - 297.5% | 181.75% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 7.0% - 181.2% | 94.1% |
| WACC | 5.8% - 134.0% | 69.9% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 13.51 | 52.25 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 66.0% | 297.5% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 95.43 | 95.43 |
| Cost of debt | 7.0% | 181.2% |
| After-tax WACC | 5.8% | 134.0% |
| Selected WACC | 69.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SOEN | Solar EnerTech Corp | 95.43 | 10.83 | 0.15 |
| DSPG | Dsp Group Inc | 0 | 0.9 | 0.9 |
| EMAN | eMagin Corp | 0.09 | 1.49 | 1.39 |
| LEDS | SemiLEDs Corp | 0.21 | 0.18 | 0.16 |
| PI | Impinj Inc | 0.1 | 1.97 | 1.84 |
| QNC.V | Quantum Numbers Corp | 0 | 0.18 | 0.18 |
| QUIK | QuickLogic Corp | 0.23 | 2.02 | 1.73 |
| SEV.V | Spectra7 Microsystems Inc | 7.06 | 0.94 | 0.15 |
| SODI | Solitron Devices Inc | 0.13 | 0.07 | 0.06 |
| SQNS | Sequans Communications SA | 2.05 | 0.86 | 0.35 |
| TGAN | Transphorm Technology Inc | 0.04 | 1.66 | 1.61 |
| Low | High | |
| Unlevered beta | 0.18 | 0.9 |
| Relevered beta | 19.67 | 77.49 |
| Adjusted relevered beta | 13.51 | 52.25 |
SOEN'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 SOEN:
cost_of_equity (181.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (13.51) + 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.