The WACC of Cofidur SA (ALCOF.PA) is 5.5%.
Range | Selected | |
Cost of equity | 6.2% - 8.6% | 7.4% |
Tax rate | 23.0% - 26.7% | 24.85% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 5.0% - 6.1% | 5.5% |
Category | Low | High |
Long-term bond rate | 3.0% | 3.5% |
Equity market risk premium | 5.8% | 6.8% |
Adjusted beta | 0.54 | 0.67 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.2% | 8.6% |
Tax rate | 23.0% | 26.7% |
Debt/Equity ratio | 1.04 | 1.04 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 5.0% | 6.1% |
Selected WACC | 5.5% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
ALCOF.PA | Cofidur SA | 1.04 | 0.2 | 0.12 |
ACG1V.HE | Aspocomp Group Oyj | 0.21 | 0.27 | 0.23 |
CPX.L | CAP XX Ltd | 0.12 | 1 | 0.92 |
EXC.DE | exceet Group SCA | 0 | -0.27 | -0.27 |
GE.MI | Gefran SpA | 0.17 | 0.61 | 0.54 |
IS7.DE | InTiCa Systems AG | 3.46 | 0.71 | 0.2 |
PLT.OL | Polight ASA | 0.01 | 1.39 | 1.37 |
SCE.DE | Schweizer Electronic AG | 2.11 | 0.4 | 0.15 |
SOLI.L | Solid State PLC | 0.14 | 0.14 | 0.13 |
XTP.WA | XTPL SA | 0.02 | 0.38 | 0.37 |
Low | High | |
Unlevered beta | 0.18 | 0.29 |
Relevered beta | 0.31 | 0.51 |
Adjusted relevered beta | 0.54 | 0.67 |
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 ALCOF.PA:
cost_of_equity (7.40%) = risk_free_rate (3.25%) + equity_risk_premium (6.30%) * adjusted_beta (0.54) + 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.