APD.AX WACC - Weighted Average Cost of Capital

The WACC of APN Property Group Ltd (APD.AX) is 7.5%.

The Cost of Equity of APN Property Group Ltd (APD.AX) is 7.65%.

The Cost of Debt of APN Property Group Ltd (APD.AX) is 5.50%.

	Range	Selected
Cost of equity	6.70% - 8.60%	7.65%
Tax rate	28.00% - 29.10%	28.55%
Cost of debt	4.00% - 7.00%	5.50%
WACC	6.6% - 8.5%	7.5%

WACC

APD.AX WACC calculation

Category	Low	High

Long-term bond rate	3.7%	4.2%
Equity market risk premium	4.7%	5.7%
Adjusted beta	0.65	0.69

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.70%	8.60%

Tax rate	28.00%	29.10%
Debt/Equity ratio	0.04	0.04
Cost of debt	4.00%	7.00%

After-tax WACC	6.6%	8.5%


Selected WACC	7.5%

APD.AX'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 APD.AX:

cost_of_equity (7.65%) = risk_free_rate (3.95%) + equity_risk_premium (5.20%) * adjusted_beta (0.65) + 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.