XPEL WACC - Weighted Average Cost of Capital
The WACC of Xpel Inc (XPEL) is 7.4%.
| Range | Selected | |
| Cost of equity | 6.1% - 8.7% | 7.4% |
| Tax rate | 20.0% - 20.0% | 20% |
| Cost of debt | 4.5% - 4.7% | 4.6% |
| WACC | 6.1% - 8.7% | 7.4% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.49 | 0.68 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.1% | 8.7% |
| Tax rate | 20.0% | 20.0% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 4.5% | 4.7% |
| After-tax WACC | 6.1% | 8.7% |
| Selected WACC | 7.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| XPEL | Xpel Inc | 0 | 1.1 | 1.09 |
| ESWW | Environmental Solutions Worldwide Inc | 42548.29 | -0.39 | 0 |
| FSCR | Federal Screw Works | 1.22 | -0.11 | -0.06 |
| KNDI | Kandi Technologies Group Inc | 0.82 | 0.62 | 0.37 |
| SSA.V | Spectra Products Inc | 0.08 | 0.45 | 0.43 |
| STRT | Strattec Security Corp | 0.05 | 1.57 | 1.51 |
| SYPR | Sypris Solutions Inc | 0.27 | 0.04 | 0.03 |
| WARM | Cool Technologies Inc | 4232.52 | -1.29 | 0 |
| WKHS | Workhorse Group Inc | 0.8 | 1.63 | 0.99 |
| XTC.TO | Exco Technologies Ltd | 0.44 | 0.89 | 0.66 |
| Low | High | |
| Unlevered beta | 0.23 | 0.52 |
| Relevered beta | 0.24 | 0.52 |
| Adjusted relevered beta | 0.49 | 0.68 |
XPEL'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 XPEL:
cost_of_equity (7.40%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.49) + 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.