TLS WACC - Weighted Average Cost of Capital
The WACC of Telos Corp (TLS) is 6.6%.
| Range | Selected | |
| Cost of equity | 5.7% - 7.6% | 6.65% |
| Tax rate | 0.0% - 0.1% | 0.05% |
| Cost of debt | 4.7% - 7.0% | 5.85% |
| WACC | 5.6% - 7.6% | 6.6% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.39 | 0.49 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.7% | 7.6% |
| Tax rate | 0.0% | 0.1% |
| Debt/Equity ratio | 0.05 | 0.05 |
| Cost of debt | 4.7% | 7.0% |
| After-tax WACC | 5.6% | 7.6% |
| Selected WACC | 6.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TLS | Telos Corp | 0.05 | 2.62 | 2.51 |
| ABST.TO | Absolute Software Corp | 0.48 | 0.34 | 0.23 |
| CNWT | Cistera Networks Inc | 0.29 | 0.03 | 0.02 |
| CWRK.V | CurrencyWorks Inc | 0.01 | 0.99 | 0.98 |
| CYRN | Cyren Ltd | 2.16 | 0.72 | 0.23 |
| FALC | FalconStor Software Inc | 0.24 | 0.15 | 0.13 |
| NXJ.TO | Nexj Systems Inc | 0.11 | 0.4 | 0.36 |
| PING | Ping Identity Holding Corp | 0.12 | 0.9 | 0.81 |
| PRGS | Progress Software Corp | 0.56 | 0.04 | 0.03 |
| QIS.V | Quorum Information Technologies Inc | 0.11 | -0.1 | -0.09 |
| SSNT | SilverSun Technologies Inc | 0.02 | -0.01 | -0.01 |
| Low | High | |
| Unlevered beta | 0.13 | 0.23 |
| Relevered beta | 0.09 | 0.24 |
| Adjusted relevered beta | 0.39 | 0.49 |
TLS'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 TLS:
cost_of_equity (6.65%) = 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.