SSTI
Shotspotter Inc
Price:  
15.78 
USD
Volume:  
29,618.00
United States | Software
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SSTI WACC - Weighted Average Cost of Capital

The WACC of Shotspotter Inc (SSTI) is 7.5%.

The Cost of Equity of Shotspotter Inc (SSTI) is 7.60%.
The Cost of Debt of Shotspotter Inc (SSTI) is 7.00%.

Range Selected
Cost of equity 5.70% - 9.50% 7.60%
Tax rate 8.70% - 11.80% 10.25%
Cost of debt 7.00% - 7.00% 7.00%
WACC 5.7% - 9.4% 7.5%
WACC

SSTI WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.39 0.82
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.70% 9.50%
Tax rate 8.70% 11.80%
Debt/Equity ratio 0.02 0.02
Cost of debt 7.00% 7.00%
After-tax WACC 5.7% 9.4%
Selected WACC 7.5%

SSTI'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 SSTI:

cost_of_equity (7.60%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.39) + 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.