SSYS WACC - Weighted Average Cost of Capital
The WACC of Stratasys Ltd (SSYS) is 7.4%.
| Range | Selected | |
| Cost of equity | 8.2% - 12.1% | 10.15% |
| Tax rate | 4.9% - 6.2% | 5.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.5% - 8.4% | 7.4% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.93 | 1.29 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.2% | 12.1% |
| Tax rate | 4.9% | 6.2% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.5% | 8.4% |
| Selected WACC | 7.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SSYS | Stratasys Ltd | 1.08 | 1.11 | 0.55 |
| ALOT | AstroNova Inc | 0.7 | 0.65 | 0.39 |
| DBD | Diebold Nixdorf Inc | 0.54 | 1.15 | 0.76 |
| IGOI | iGO Inc | 0.92 | 0.89 | 0.48 |
| KODK | Eastman Kodak Co | 1.07 | 1.94 | 0.96 |
| NNDM | Nano Dimension Ltd | 0.04 | 1.11 | 1.07 |
| OSS | One Stop Systems Inc | 0.02 | 1.79 | 1.76 |
| OTIVF | On Track Innovations Ltd | 1.95 | 0.81 | 0.29 |
| TACT | TransAct Technologies Inc | 0.08 | 0.48 | 0.44 |
| TTD.V | Tinkerine Studios Ltd | 0.37 | 0.97 | 0.72 |
| VIDE | Video Display Corp | 0.46 | -0.59 | -0.41 |
| Low | High | |
| Unlevered beta | 0.48 | 0.72 |
| Relevered beta | 0.9 | 1.43 |
| Adjusted relevered beta | 0.93 | 1.29 |
SSYS'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 SSYS:
cost_of_equity (10.15%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.93) + 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.