ALPHA.AT WACC - Weighted Average Cost of Capital

The WACC of Alpha Bank SA (ALPHA.AT) is 9.2%.

The Cost of Equity of Alpha Bank SA (ALPHA.AT) is 13.90%.

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

	Range	Selected
Cost of equity	11.90% - 15.90%	13.90%
Tax rate	16.90% - 28.20%	22.55%
Cost of debt	5.00% - 5.00%	5.00%
WACC	8.3% - 10.1%	9.2%

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	0.98	1.18

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.90%	15.90%

Tax rate	16.90%	28.20%
Debt/Equity ratio	0.88	0.88
Cost of debt	5.00%	5.00%

After-tax WACC	8.3%	10.1%


Selected WACC	9.2%

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 (13.90%) = risk_free_rate (3.55%) + equity_risk_premium (9.30%) * adjusted_beta (0.98) + 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.