VECO
Veeco Instruments Inc
Price:  
21.16 
USD
Volume:  
382,710.00
United States | Semiconductors & Semiconductor Equipment
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VECO WACC - Weighted Average Cost of Capital

The WACC of Veeco Instruments Inc (VECO) is 10.9%.

The Cost of Equity of Veeco Instruments Inc (VECO) is 12.45%.
The Cost of Debt of Veeco Instruments Inc (VECO) is 4.40%.

Range Selected
Cost of equity 10.70% - 14.20% 12.45%
Tax rate 4.90% - 7.10% 6.00%
Cost of debt 4.00% - 4.80% 4.40%
WACC 9.4% - 12.5% 10.9%
WACC

VECO WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.48 1.67
Additional risk adjustments 0.0% 0.5%
Cost of equity 10.70% 14.20%
Tax rate 4.90% 7.10%
Debt/Equity ratio 0.22 0.22
Cost of debt 4.00% 4.80%
After-tax WACC 9.4% 12.5%
Selected WACC 10.9%

VECO'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 VECO:

cost_of_equity (12.45%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.48) + 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.