CBI.TA WACC - Weighted Average Cost of Capital

The WACC of Clal Biotechnology Industries Ltd (CBI.TA) is 8.5%.

The Cost of Equity of Clal Biotechnology Industries Ltd (CBI.TA) is 11.15%.

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

	Range	Selected
Cost of equity	9.40% - 12.90%	11.15%
Tax rate	23.00% - 23.00%	23.00%
Cost of debt	4.70% - 7.00%	5.85%
WACC	7.1% - 9.9%	8.5%

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	0.74	1

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.40%	12.90%

Tax rate	23.00%	23.00%
Debt/Equity ratio	0.68	0.68
Cost of debt	4.70%	7.00%

After-tax WACC	7.1%	9.9%


Selected WACC	8.5%

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 (11.15%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.74) + 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.