AEP.V WACC - Weighted Average Cost of Capital

The WACC of Atlas Engineered Products Ltd (AEP.V) is 11.4%.

The Cost of Equity of Atlas Engineered Products Ltd (AEP.V) is 10.20%.

The Cost of Debt of Atlas Engineered Products Ltd (AEP.V) is 18.75%.

	Range	Selected
Cost of equity	8.20% - 12.20%	10.20%
Tax rate	28.20% - 31.60%	29.90%
Cost of debt	13.60% - 23.90%	18.75%
WACC	8.9% - 14.0%	11.4%

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	0.85	1.2

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.20%	12.20%

Tax rate	28.20%	31.60%
Debt/Equity ratio	0.76	0.76
Cost of debt	13.60%	23.90%

After-tax WACC	8.9%	14.0%


Selected WACC	11.4%

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 (10.20%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.85) + 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.