2300.SR
Saudi Paper Manufacturing Company SJSC
Price:  
67.20 
SAR
Volume:  
73,696.00
Saudi Arabia | Paper & Forest Products
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2300.SR WACC - Weighted Average Cost of Capital

The WACC of Saudi Paper Manufacturing Company SJSC (2300.SR) is 11.9%.

The Cost of Equity of Saudi Paper Manufacturing Company SJSC (2300.SR) is 13.35%.
The Cost of Debt of Saudi Paper Manufacturing Company SJSC (2300.SR) is 5.00%.

Range Selected
Cost of equity 12.20% - 14.50% 13.35%
Tax rate 6.80% - 9.40% 8.10%
Cost of debt 5.00% - 5.00% 5.00%
WACC 10.9% - 12.9% 11.9%
WACC

2300.SR WACC calculation

Category Low High
Long-term bond rate 5.9% 6.4%
Equity market risk premium 6.1% 7.1%
Adjusted beta 1.02 1.07
Additional risk adjustments 0.0% 0.5%
Cost of equity 12.20% 14.50%
Tax rate 6.80% 9.40%
Debt/Equity ratio 0.2 0.2
Cost of debt 5.00% 5.00%
After-tax WACC 10.9% 12.9%
Selected WACC 11.9%

2300.SR'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 2300.SR:

cost_of_equity (13.35%) = risk_free_rate (6.15%) + equity_risk_premium (6.60%) * adjusted_beta (1.02) + 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.