ABSO.ST WACC - Weighted Average Cost of Capital

The WACC of Absolent Group AB (ABSO.ST) is 5.4%.

The Cost of Equity of Absolent Group AB (ABSO.ST) is 5.90%.

The Cost of Debt of Absolent Group AB (ABSO.ST) is 4.25%.

	Range	Selected
Cost of equity	4.50% - 7.30%	5.90%
Tax rate	22.60% - 23.70%	23.15%
Cost of debt	4.00% - 4.50%	4.25%
WACC	4.2% - 6.6%	5.4%

WACC

ABSO.ST WACC calculation

Category	Low	High

Long-term bond rate	2.5%	3.0%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.38	0.61

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.50%	7.30%

Tax rate	22.60%	23.70%
Debt/Equity ratio	0.2	0.2
Cost of debt	4.00%	4.50%

After-tax WACC	4.2%	6.6%


Selected WACC	5.4%

ABSO.ST'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 ABSO.ST:

cost_of_equity (5.90%) = risk_free_rate (2.75%) + equity_risk_premium (5.60%) * adjusted_beta (0.38) + 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.