The WACC of Bera Holding AS (BERA.IS) is 24.5%.
| Range | Selected | |
| Cost of equity | 30.00% - 33.40% | 31.70% |
| Tax rate | 30.70% - 32.90% | 31.80% |
| Cost of debt | 5.00% - 5.00% | 5.00% |
| WACC | 23.3% - 25.8% | 24.5% |
| Category | Low | High |
| Long-term bond rate | 21.4% | 21.9% |
| Equity market risk premium | 10.2% | 11.2% |
| Adjusted beta | 0.85 | 0.98 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 30.00% | 33.40% |
| Tax rate | 30.70% | 32.90% |
| Debt/Equity ratio | 0.34 | 0.34 |
| Cost of debt | 5.00% | 5.00% |
| After-tax WACC | 23.3% | 25.8% |
| Selected WACC | 24.5% | |
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 BERA.IS:
cost_of_equity (31.70%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.85) + 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.