BLND.L WACC - Weighted Average Cost of Capital
The WACC of British Land Company PLC (BLND.L) is 7.1%.
| Range | Selected | |
| Cost of equity | 7.4% - 10.3% | 8.85% |
| Tax rate | 0.9% - 1.8% | 1.35% |
| Cost of debt | 4.0% - 5.5% | 4.75% |
| WACC | 5.9% - 8.2% | 7.1% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.58 | 0.76 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.4% | 10.3% |
| Tax rate | 0.9% | 1.8% |
| Debt/Equity ratio | 0.76 | 0.76 |
| Cost of debt | 4.0% | 5.5% |
| After-tax WACC | 5.9% | 8.2% |
| Selected WACC | 7.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| BLND.L | British Land Company PLC | 0.76 | 0.98 | 0.56 |
| CAPC.L | Capital & Counties Properties PLC | 0.67 | 1.36 | 0.82 |
| CARM.PA | Carmila SA | 1.15 | 0.45 | 0.21 |
| ECMPA.AS | Eurocommercial Properties NV | 1.06 | 0.5 | 0.24 |
| HMSO.L | Hammerson PLC | 1.06 | 1.29 | 0.63 |
| LI.PA | Klepierre SA | 0.84 | 0.22 | 0.12 |
| MERY.PA | Mercialys SA | 1.28 | 0.14 | 0.06 |
| RET.BR | Retail Estates NV | 0.95 | 0.41 | 0.21 |
| SHB.L | Shaftesbury PLC | 0.6 | 0.95 | 0.6 |
| WHA.AS | Wereldhave NV | 1.21 | 0.47 | 0.21 |
| Low | High | |
| Unlevered beta | 0.21 | 0.37 |
| Relevered beta | 0.37 | 0.64 |
| Adjusted relevered beta | 0.58 | 0.76 |
BLND.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 BLND.L:
cost_of_equity (8.85%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.58) + 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.