VVI
Viad Corp
Price:  
42.51 
USD
Volume:  
141,196
United States | Commercial Services & Supplies

Viad WACC - Weighted Average Cost of Capital

The WACC of Viad Corp (VVI) is 6.0%.

The Cost of Equity of Viad Corp (VVI) is 6.15%.
The Cost of Debt of Viad Corp (VVI) is 7.3%.

RangeSelected
Cost of equity5.2% - 7.1%6.15%
Tax rate17.7% - 27.6%22.65%
Cost of debt7.0% - 7.6%7.3%
WACC5.4% - 6.6%6.0%
WACC

Viad WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta0.290.4
Additional risk adjustments0.0%0.5%
Cost of equity5.2%7.1%
Tax rate17.7%27.6%
Debt/Equity ratio
0.50.5
Cost of debt7.0%7.6%
After-tax WACC5.4%6.6%
Selected WACC6.0%

Viad'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 Viad:

cost_of_equity (6.15%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.29) + 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.