The WACC of Autogrill SpA (AGL.MI) is 7.4%.
Range | Selected | |
Cost of equity | 9.6% - 12.0% | 10.8% |
Tax rate | 24.0% - 24.0% | 24% |
Cost of debt | 4.0% - 4.7% | 4.35% |
WACC | 6.6% - 8.2% | 7.4% |
Category | Low | High |
Long-term bond rate | 3.7% | 4.2% |
Equity market risk premium | 8.3% | 9.3% |
Adjusted beta | 0.72 | 0.79 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 9.6% | 12.0% |
Tax rate | 24.0% | 24.0% |
Debt/Equity ratio | 0.83 | 0.83 |
Cost of debt | 4.0% | 4.7% |
After-tax WACC | 6.6% | 8.2% |
Selected WACC | 7.4% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
AGL.MI | Autogrill SpA | 0.83 | 0.41 | 0.25 |
DOM.L | Domino's Pizza Group PLC | 0.55 | 0.81 | 0.57 |
FSTA.L | Fuller Smith & Turner PLC | 0.69 | 0.7 | 0.46 |
IBS.LS | Ibersol SGPS SA | 0.79 | 0.12 | 0.07 |
JDW.L | J D Wetherspoon PLC | 1.38 | 0.82 | 0.4 |
MAB.L | Mitchells & Butlers PLC | 0.97 | 0.95 | 0.55 |
MARS.L | Marston's PLC | 5.03 | 1.42 | 0.29 |
RTN.L | Restaurant Group PLC | 1.22 | 0.76 | 0.39 |
SSPG.L | SSP Group PLC | 1.43 | 1.32 | 0.63 |
YNGA.L | Young & Co's Brewery PLC | 0.68 | 0.28 | 0.18 |
Low | High | |
Unlevered beta | 0.35 | 0.42 |
Relevered beta | 0.58 | 0.69 |
Adjusted relevered beta | 0.72 | 0.79 |
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 AGL.MI:
cost_of_equity (10.80%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.72) + 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.