CIN.L
City of London Group PLC
Price:  
10 
GBP
Volume:  
265,676
United Kingdom | Diversified Financial Services

CIN.L WACC - Weighted Average Cost of Capital

The WACC of City of London Group PLC (CIN.L) is 7.3%.

The Cost of Equity of City of London Group PLC (CIN.L) is 8.2%.
The Cost of Debt of City of London Group PLC (CIN.L) is 5%.

RangeSelected
Cost of equity7.2% - 9.2%8.2%
Tax rate19.0% - 19.0%19%
Cost of debt5.0% - 5.0%5%
WACC6.5% - 8.1%7.3%
WACC

CIN.L WACC calculation

CategoryLowHigh
Long-term bond rate4.0%4.5%
Equity market risk premium6.0%7.0%
Adjusted beta0.530.61
Additional risk adjustments0.0%0.5%
Cost of equity7.2%9.2%
Tax rate19.0%19.0%
Debt/Equity ratio
0.270.27
Cost of debt5.0%5.0%
After-tax WACC6.5%8.1%
Selected WACC7.3%

CIN.L'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 CIN.L:

cost_of_equity (8.20%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * 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.