CBI.TA WACC - Weighted Average Cost of Capital

The WACC of Clal Biotechnology Industries Ltd (CBI.TA) is 7.7%.

The Cost of Equity of Clal Biotechnology Industries Ltd (CBI.TA) is 10.10%.

The Cost of Debt of Clal Biotechnology Industries Ltd (CBI.TA) is 5.85%.

	Range	Selected
Cost of equity	8.00% - 12.20%	10.10%
Tax rate	23.00% - 23.00%	23.00%
Cost of debt	4.70% - 7.00%	5.85%
WACC	6.2% - 9.3%	7.7%

WACC

CBI.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.52	0.89

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.00%	12.20%

Tax rate	23.00%	23.00%
Debt/Equity ratio	0.73	0.73
Cost of debt	4.70%	7.00%

After-tax WACC	6.2%	9.3%


Selected WACC	7.7%

CBI.TA'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 CBI.TA:

cost_of_equity (10.10%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.52) + 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.