VIAC
ViacomCBS Inc
Price:  
29.58 
USD
Volume:  
88,911,000.00
United States | Media
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VIAC WACC - Weighted Average Cost of Capital

The WACC of ViacomCBS Inc (VIAC) is 7.2%.

The Cost of Equity of ViacomCBS Inc (VIAC) is 8.95%.
The Cost of Debt of ViacomCBS Inc (VIAC) is 6.15%.

Range Selected
Cost of equity 7.60% - 10.30% 8.95%
Tax rate 16.80% - 17.90% 17.35%
Cost of debt 4.50% - 7.80% 6.15%
WACC 5.8% - 8.5% 7.2%
WACC

VIAC WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 4.2% 5.2%
Adjusted beta 1.04 1.17
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.60% 10.30%
Tax rate 16.80% 17.90%
Debt/Equity ratio 0.85 0.85
Cost of debt 4.50% 7.80%
After-tax WACC 5.8% 8.5%
Selected WACC 7.2%

VIAC'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 VIAC:

cost_of_equity (8.95%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * adjusted_beta (1.04) + 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.