APP.L WACC - Weighted Average Cost of Capital
The WACC of Appreciate Group PLC (APP.L) is 7.6%.
| Range | Selected | |
| Cost of equity | 6.3% - 9.6% | 7.95% |
| Tax rate | 21.9% - 24.7% | 23.3% |
| Cost of debt | 4.0% - 4.6% | 4.3% |
| WACC | 6.1% - 9.2% | 7.6% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.39 | 0.66 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.3% | 9.6% |
| Tax rate | 21.9% | 24.7% |
| Debt/Equity ratio | 0.07 | 0.07 |
| Cost of debt | 4.0% | 4.6% |
| After-tax WACC | 6.1% | 9.2% |
| Selected WACC | 7.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| APP.L | Appreciate Group PLC | 0.07 | 1.29 | 1.22 |
| ASAI.L | ASA International Group PLC | 2.12 | 1.32 | 0.5 |
| HAT.L | H & T Group PLC | 0.32 | 0.56 | 0.45 |
| MBC.DE | MyBucks SA | 126.78 | 1.49 | 0.01 |
| MCL.L | Morses Club PLC | 48.49 | 2.08 | 0.05 |
| MFX.L | Manx Financial Group PLC | 1.33 | 1.69 | 0.83 |
| PCF.L | PCF Group PLC | 175.29 | 1.35 | 0.01 |
| QLIRO.ST | Qliro AB | 4.49 | 0.45 | 0.1 |
| SUS.L | S&U PLC | 0.91 | 0 | 0 |
| TSL.L | Thinksmart Ltd | 0 | 0.83 | 0.83 |
| Low | High | |
| Unlevered beta | 0.08 | 0.47 |
| Relevered beta | 0.09 | 0.49 |
| Adjusted relevered beta | 0.39 | 0.66 |
APP.L'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 APP.L:
cost_of_equity (7.95%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.39) + 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.