BVI.PA WACC - Weighted Average Cost of Capital

The WACC of Bureau Veritas SA (BVI.PA) is 7.1%.

The Cost of Equity of Bureau Veritas SA (BVI.PA) is 7.95%.

The Cost of Debt of Bureau Veritas SA (BVI.PA) is 4.25%.

	Range	Selected
Cost of equity	6.40% - 9.50%	7.95%
Tax rate	31.80% - 32.10%	31.95%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.8% - 8.3%	7.1%

WACC

BVI.PA WACC calculation

Category	Low	High

Long-term bond rate	3.0%	3.5%
Equity market risk premium	5.8%	6.8%
Adjusted beta	0.59	0.8

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.40%	9.50%

Tax rate	31.80%	32.10%
Debt/Equity ratio	0.21	0.21
Cost of debt	4.00%	4.50%

After-tax WACC	5.8%	8.3%


Selected WACC	7.1%

BVI.PA'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 BVI.PA:

cost_of_equity (7.95%) = risk_free_rate (3.25%) + equity_risk_premium (6.30%) * 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.