CAST.ST WACC - Weighted Average Cost of Capital

The WACC of Castellum AB (CAST.ST) is 5.2%.

The Cost of Equity of Castellum AB (CAST.ST) is 6.60%.

The Cost of Debt of Castellum AB (CAST.ST) is 4.85%.

	Range	Selected
Cost of equity	4.90% - 8.30%	6.60%
Tax rate	17.90% - 20.30%	19.10%
Cost of debt	4.00% - 5.70%	4.85%
WACC	4.1% - 6.4%	5.2%

WACC

CAST.ST WACC calculation

Category	Low	High

Long-term bond rate	2.5%	3.0%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.48	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.90%	8.30%

Tax rate	17.90%	20.30%
Debt/Equity ratio	1.07	1.07
Cost of debt	4.00%	5.70%

After-tax WACC	4.1%	6.4%


Selected WACC	5.2%

CAST.ST'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 CAST.ST:

cost_of_equity (6.60%) = risk_free_rate (2.75%) + equity_risk_premium (5.60%) * adjusted_beta (0.48) + 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.