VSH WACC - Weighted Average Cost of Capital
The WACC of Vishay Intertechnology Inc (VSH) is 9.0%.
| Range | Selected | |
| Cost of equity | 9.9% - 12.4% | 11.15% |
| Tax rate | 29.2% - 30.7% | 29.95% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 7.8% - 10.2% | 9.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 1.32 | 1.34 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.9% | 12.4% |
| Tax rate | 29.2% | 30.7% |
| Debt/Equity ratio | 0.42 | 0.42 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 7.8% | 10.2% |
| Selected WACC | 9.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| VSH | Vishay Intertechnology Inc | 0.42 | 1.84 | 1.43 |
| BDC | Belden Inc | 0.25 | 1.35 | 1.15 |
| BELFA | Bel Fuse Inc | 0.26 | 1.4 | 1.18 |
| CPSH | CPS Technologies Corp | 0 | 0.03 | 0.03 |
| DYSL | Dynasil Corporation of America | 0.22 | 0.06 | 0.05 |
| IIVI | II-VI Inc | 0.42 | 1.46 | 1.13 |
| KN | Knowles Corp | 0.13 | 1.68 | 1.54 |
| LFUS | Littelfuse Inc | 0.15 | 1.77 | 1.6 |
| MPAD | Micropac Industries Inc | 0.31 | 0.68 | 0.56 |
| ROG | Rogers Corp | 0 | 1.14 | 1.14 |
| Low | High | |
| Unlevered beta | 1.13 | 1.16 |
| Relevered beta | 1.48 | 1.51 |
| Adjusted relevered beta | 1.32 | 1.34 |
VSH'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 VSH:
cost_of_equity (11.15%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.32) + 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.