8240.SR WACC - Weighted Average Cost of Capital
The WACC of CHUBB Arabia Cooperative Insurance Company SJSC (8240.SR) is 11.2%.
| Range | Selected | |
| Cost of equity | 16.5% - 21.0% | 18.75% |
| Tax rate | 24.1% - 29.4% | 26.75% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 10.2% - 12.2% | 11.2% |
| Category | Low | High |
| Long-term bond rate | 5.9% | 6.4% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 1.74 | 1.97 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 16.5% | 21.0% |
| Tax rate | 24.1% | 29.4% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 10.2% | 12.2% |
| Selected WACC | 11.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 8240.SR | CHUBB Arabia Cooperative Insurance Company SJSC | 0 | 1.95 | 1.95 |
| 8012.SR | Aljazira Takaful Taawuni Company SJSC | 0.02 | 1.44 | 1.42 |
| 8040.SR | Allianz Saudi Fransi Cooperative Insurance Company SJSC | 0 | 1.36 | 1.36 |
| 8120.SR | Gulf Union Alahlia Cooperative Insurance Co | 0.01 | 1.4 | 1.38 |
| 8150.SR | Allied Cooperative Insurance Group SJSC | 0.02 | 1.9 | 1.87 |
| 8160.SR | Arabia Insurance Cooperative Company SJSC | 0.01 | 0.95 | 0.95 |
| 8260.SR | Gulf General Cooperative Insurance Company SJSC | 0.02 | 1.55 | 1.53 |
| 8300.SR | Wataniya Insurance Company SJSC | 0.01 | 1.62 | 1.61 |
| 8312.SR | Alinma Tokio Marine Company SJSC | 0.01 | 0.96 | 0.95 |
| ASCANA.DB | Arabian Scandinavian Insurance Co PLC | 0.35 | -0.33 | -0.26 |
| DIN.DB | Dubai Insurance Co PSC | 0.03 | 0.11 | 0.11 |
| Low | High | |
| Unlevered beta | 1.36 | 1.42 |
| Relevered beta | 2.1 | 2.45 |
| Adjusted relevered beta | 1.74 | 1.97 |
8240.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 8240.SR:
cost_of_equity (18.75%) = risk_free_rate (6.15%) + equity_risk_premium (6.60%) * adjusted_beta (1.74) + 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.