AGAS.OL
Avance Gas Holding Ltd
Price:  
1.63 
NOK
Volume:  
616,784.00
Bermuda | Oil, Gas & Consumable Fuels
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AGAS.OL WACC - Weighted Average Cost of Capital

The WACC of Avance Gas Holding Ltd (AGAS.OL) is 10.8%.

The Cost of Equity of Avance Gas Holding Ltd (AGAS.OL) is 9.05%.
The Cost of Debt of Avance Gas Holding Ltd (AGAS.OL) is 12.60%.

Range Selected
Cost of equity 7.80% - 10.30% 9.05%
Tax rate 0.10% - 0.20% 0.15%
Cost of debt 4.90% - 20.30% 12.60%
WACC 6.3% - 15.3% 10.8%
WACC

AGAS.OL WACC calculation

Category Low High
Long-term bond rate 3.3% 3.8%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.87 0.98
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.80% 10.30%
Tax rate 0.10% 0.20%
Debt/Equity ratio 1 1
Cost of debt 4.90% 20.30%
After-tax WACC 6.3% 15.3%
Selected WACC 10.8%

AGAS.OL'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 AGAS.OL:

cost_of_equity (9.05%) = risk_free_rate (3.55%) + equity_risk_premium (5.60%) * adjusted_beta (0.87) + 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.