ASC.L
ASOS PLC
Price:  
293.50 
GBP
Volume:  
255,338.00
United Kingdom | Internet & Direct Marketing Retail
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ASC.L WACC - Weighted Average Cost of Capital

The WACC of ASOS PLC (ASC.L) is 5.7%.

The Cost of Equity of ASOS PLC (ASC.L) is 9.55%.
The Cost of Debt of ASOS PLC (ASC.L) is 5.50%.

Range Selected
Cost of equity 7.40% - 11.70% 9.55%
Tax rate 16.40% - 22.10% 19.25%
Cost of debt 4.00% - 7.00% 5.50%
WACC 4.4% - 7.1% 5.7%
WACC

ASC.L WACC calculation

Category Low High
Long-term bond rate 4.0% 4.5%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.57 0.96
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.40% 11.70%
Tax rate 16.40% 22.10%
Debt/Equity ratio 2.82 2.82
Cost of debt 4.00% 7.00%
After-tax WACC 4.4% 7.1%
Selected WACC 5.7%

ASC.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 ASC.L:

cost_of_equity (9.55%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.57) + 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.