The WACC of View Systems Inc (VSYM) is 4.7%.
Range | Selected | |
Cost of equity | 5.4% - 6.7% | 6.05% |
Tax rate | 26.2% - 27.0% | 26.6% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 4.5% - 5.0% | 4.7% |
Category | Low | High |
Long-term bond rate | 3.9% | 4.4% |
Equity market risk premium | 4.6% | 5.6% |
Adjusted beta | 0.33 | 0.33 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 5.4% | 6.7% |
Tax rate | 26.2% | 27.0% |
Debt/Equity ratio | 1.22 | 1.22 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 4.5% | 5.0% |
Selected WACC | 4.7% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
VSYM | View Systems Inc | 1.22 | 1.04 | 0.55 |
CRGS | CurAegis Technologies Inc | 1843.54 | 1.06 | 0 |
DPLS | Darkpulse Inc | 0.58 | 0.02 | 0.01 |
ESNR | Electronic Sensor Technology Inc | 12277.67 | -0.15 | 0 |
SMIT | Schmitt Industries Inc | 42.8 | 0.93 | 0.03 |
SNSGF | Sense Technologies Inc | 151016.06 | 0 | 0 |
TEST.V | FluroTech Ltd | 0.27 | -0.59 | -0.49 |
TNLX | Trans Lux Corp | 1.18 | -0.73 | -0.39 |
Low | High | |
Unlevered beta | 0 | 0 |
Relevered beta | 0 | 0 |
Adjusted relevered beta | 0.33 | 0.33 |
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 VSYM:
cost_of_equity (6.05%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.33) + 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.