The WACC of Caisse Regionale de Credit Agricole Mutuel de Normandie Seine SC (CCN.PA) is 4.8%.
| Range | Selected | |
| Cost of equity | 10.20% - 13.50% | 11.85% |
| Tax rate | 23.70% - 24.70% | 24.20% |
| Cost of debt | 5.00% - 5.00% | 5.00% |
| WACC | 4.6% - 5.0% | 4.8% |
| Category | Low | High |
| Long-term bond rate | 3.0% | 3.5% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 1.25 | 1.39 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.20% | 13.50% |
| Tax rate | 23.70% | 24.70% |
| Debt/Equity ratio | 6.85 | 6.85 |
| Cost of debt | 5.00% | 5.00% |
| After-tax WACC | 4.6% | 5.0% |
| Selected WACC | 4.8% | |
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 CCN.PA:
cost_of_equity (11.85%) = risk_free_rate (3.25%) + equity_risk_premium (6.30%) * adjusted_beta (1.25) + 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.