VREX
Varex Imaging Corp
Price:  
8.72 
USD
Volume:  
388,326.00
United States | Health Care Equipment & Supplies
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

VREX WACC - Weighted Average Cost of Capital

The WACC of Varex Imaging Corp (VREX) is 7.9%.

The Cost of Equity of Varex Imaging Corp (VREX) is 11.15%.
The Cost of Debt of Varex Imaging Corp (VREX) is 9.25%.

Range Selected
Cost of equity 9.20% - 13.10% 11.15%
Tax rate 34.80% - 44.70% 39.75%
Cost of debt 6.10% - 12.40% 9.25%
WACC 6.3% - 9.6% 7.9%
WACC

VREX WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.17 1.47
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.20% 13.10%
Tax rate 34.80% 44.70%
Debt/Equity ratio 1.29 1.29
Cost of debt 6.10% 12.40%
After-tax WACC 6.3% 9.6%
Selected WACC 7.9%

VREX'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 VREX:

cost_of_equity (11.15%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.17) + 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.