CBRE
CBRE Group Inc
Price:  
121.36 
USD
Volume:  
1,337,334.00
United States | Real Estate Management & Development
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

CBRE WACC - Weighted Average Cost of Capital

The WACC of CBRE Group Inc (CBRE) is 8.5%.

The Cost of Equity of CBRE Group Inc (CBRE) is 9.00%.
The Cost of Debt of CBRE Group Inc (CBRE) is 5.80%.

Range Selected
Cost of equity 7.90% - 10.10% 9.00%
Tax rate 17.70% - 20.60% 19.15%
Cost of debt 5.60% - 6.00% 5.80%
WACC 7.5% - 9.6% 8.5%
WACC

CBRE WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.87 0.94
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.90% 10.10%
Tax rate 17.70% 20.60%
Debt/Equity ratio 0.12 0.12
Cost of debt 5.60% 6.00%
After-tax WACC 7.5% 9.6%
Selected WACC 8.5%

CBRE'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 CBRE:

cost_of_equity (9.00%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.87) + 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.