ALPHA.AT WACC - Weighted Average Cost of Capital

The WACC of Alpha Bank SA (ALPHA.AT) is 10.1%.

The Cost of Equity of Alpha Bank SA (ALPHA.AT) is 14.95%.

The Cost of Debt of Alpha Bank SA (ALPHA.AT) is 5.00%.

	Range	Selected
Cost of equity	13.00% - 16.90%	14.95%
Tax rate	16.90% - 28.20%	22.55%
Cost of debt	5.00% - 5.00%	5.00%
WACC	9.1% - 11.1%	10.1%

WACC

ALPHA.AT WACC calculation

Category	Low	High

Long-term bond rate	3.3%	3.8%
Equity market risk premium	8.8%	9.8%
Adjusted beta	1.1	1.29

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.00%	16.90%

Tax rate	16.90%	28.20%
Debt/Equity ratio	0.78	0.78
Cost of debt	5.00%	5.00%

After-tax WACC	9.1%	11.1%


Selected WACC	10.1%

ALPHA.AT'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 ALPHA.AT:

cost_of_equity (14.95%) = risk_free_rate (3.55%) + equity_risk_premium (9.30%) * adjusted_beta (1.1) + 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.