AKTIA.HE WACC - Weighted Average Cost of Capital

The WACC of Aktia Bank Abp (AKTIA.HE) is 4.5%.

The Cost of Equity of Aktia Bank Abp (AKTIA.HE) is 7.70%.

The Cost of Debt of Aktia Bank Abp (AKTIA.HE) is 5.00%.

	Range	Selected
Cost of equity	5.90% - 9.50%	7.70%
Tax rate	20.40% - 20.60%	20.50%
Cost of debt	5.00% - 5.00%	5.00%
WACC	4.2% - 4.8%	4.5%

WACC

AKTIA.HE WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.7%	6.7%
Adjusted beta	0.56	0.86

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.90%	9.50%

Tax rate	20.40%	20.60%
Debt/Equity ratio	6.08	6.08
Cost of debt	5.00%	5.00%

After-tax WACC	4.2%	4.8%


Selected WACC	4.5%

AKTIA.HE'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 AKTIA.HE:

cost_of_equity (7.70%) = risk_free_rate (2.95%) + equity_risk_premium (6.20%) * adjusted_beta (0.56) + 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.