The WACC of Aygaz AS (AYGAZ.IS) is 26.4%.
| Range | Selected | |
| Cost of equity | 27.30% - 30.50% | 28.90% |
| Tax rate | 9.70% - 10.80% | 10.25% |
| Cost of debt | 15.70% - 24.10% | 19.90% |
| WACC | 24.4% - 28.5% | 26.4% |
| Category | Low | High |
| Long-term bond rate | 21.4% | 21.9% |
| Equity market risk premium | 10.2% | 11.2% |
| Adjusted beta | 0.59 | 0.73 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 27.30% | 30.50% |
| Tax rate | 9.70% | 10.80% |
| Debt/Equity ratio | 0.29 | 0.29 |
| Cost of debt | 15.70% | 24.10% |
| After-tax WACC | 24.4% | 28.5% |
| Selected WACC | 26.4% | |
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 AYGAZ.IS:
cost_of_equity (28.90%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.59) + 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.