CEL.TA WACC - Weighted Average Cost of Capital

The WACC of Cellcom Israel Ltd (CEL.TA) is 7.0%.

The Cost of Equity of Cellcom Israel Ltd (CEL.TA) is 8.90%.

The Cost of Debt of Cellcom Israel Ltd (CEL.TA) is 5.50%.

	Range	Selected
Cost of equity	8.10% - 9.70%	8.90%
Tax rate	24.40% - 27.20%	25.80%
Cost of debt	4.00% - 7.00%	5.50%
WACC	6.1% - 8.0%	7.0%

WACC

CEL.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.53	0.55

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.10%	9.70%

Tax rate	24.40%	27.20%
Debt/Equity ratio	0.63	0.63
Cost of debt	4.00%	7.00%

After-tax WACC	6.1%	8.0%


Selected WACC	7.0%

CEL.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 CEL.TA:

cost_of_equity (8.90%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.53) + 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.