BBB.L WACC - Weighted Average Cost of Capital

The WACC of Bigblu Broadband PLC (BBB.L) is 9.6%.

The Cost of Equity of Bigblu Broadband PLC (BBB.L) is 7.55%.

The Cost of Debt of Bigblu Broadband PLC (BBB.L) is 12.85%.

	Range	Selected
Cost of equity	6.40% - 8.70%	7.55%
Tax rate	2.70% - 5.40%	4.05%
Cost of debt	7.00% - 18.70%	12.85%
WACC	6.6% - 12.6%	9.6%

WACC

BBB.L WACC calculation

Category	Low	High

Long-term bond rate	4.0%	4.5%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.4	0.54

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.40%	8.70%

Tax rate	2.70%	5.40%
Debt/Equity ratio	0.75	0.75
Cost of debt	7.00%	18.70%

After-tax WACC	6.6%	12.6%


Selected WACC	9.6%

BBB.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 BBB.L:

cost_of_equity (7.55%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.4) + 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.