SQNS
Sequans Communications SA
Price:  
1.82 
USD
Volume:  
13,063.00
France | Semiconductors & Semiconductor Equipment
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SQNS WACC - Weighted Average Cost of Capital

The WACC of Sequans Communications SA (SQNS) is 10.5%.

The Cost of Equity of Sequans Communications SA (SQNS) is 14.75%.
The Cost of Debt of Sequans Communications SA (SQNS) is 8.55%.

Range Selected
Cost of equity 12.00% - 17.50% 14.75%
Tax rate 5.00% - 6.50% 5.75%
Cost of debt 7.00% - 10.10% 8.55%
WACC 8.6% - 12.4% 10.5%
WACC

SQNS WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.76 2.26
Additional risk adjustments 0.0% 0.5%
Cost of equity 12.00% 17.50%
Tax rate 5.00% 6.50%
Debt/Equity ratio 1.7 1.7
Cost of debt 7.00% 10.10%
After-tax WACC 8.6% 12.4%
Selected WACC 10.5%

SQNS'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 SQNS:

cost_of_equity (14.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.76) + 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.