The WACC of Arcelik AS (ARCLK.IS) is 24.7%.
| Range | Selected | |
| Cost of equity | 29.10% - 32.10% | 30.60% |
| Tax rate | 9.30% - 11.70% | 10.50% |
| Cost of debt | 10.40% - 23.10% | 16.75% |
| WACC | 21.6% - 27.7% | 24.7% |
| Category | Low | High |
| Long-term bond rate | 21.4% | 21.9% |
| Equity market risk premium | 10.2% | 11.2% |
| Adjusted beta | 0.76 | 0.88 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 29.10% | 32.10% |
| Tax rate | 9.30% | 11.70% |
| Debt/Equity ratio | 0.61 | 0.61 |
| Cost of debt | 10.40% | 23.10% |
| After-tax WACC | 21.6% | 27.7% |
| Selected WACC | 24.7% | |
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 ARCLK.IS:
cost_of_equity (30.60%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.76) + 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.