AEP.V WACC - Weighted Average Cost of Capital

The WACC of Atlas Engineered Products Ltd (AEP.V) is 9.2%.

The Cost of Equity of Atlas Engineered Products Ltd (AEP.V) is 9.35%.

The Cost of Debt of Atlas Engineered Products Ltd (AEP.V) is 12.90%.

	Range	Selected
Cost of equity	8.00% - 10.70%	9.35%
Tax rate	28.20% - 31.00%	29.60%
Cost of debt	10.20% - 15.60%	12.90%
WACC	7.7% - 10.7%	9.2%

WACC

AEP.V WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.81	0.96

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.00%	10.70%

Tax rate	28.20%	31.00%
Debt/Equity ratio	0.7	0.7
Cost of debt	10.20%	15.60%

After-tax WACC	7.7%	10.7%


Selected WACC	9.2%

AEP.V'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 AEP.V:

cost_of_equity (9.35%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.81) + 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.