CIR.MI
CIR SpA - Compagnie Industriali Riunite
Price:  
0.59 
EUR
Volume:  
252,827.00
Italy | Auto Components
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CIR.MI WACC - Weighted Average Cost of Capital

The WACC of CIR SpA - Compagnie Industriali Riunite (CIR.MI) is 7.2%.

The Cost of Equity of CIR SpA - Compagnie Industriali Riunite (CIR.MI) is 16.60%.
The Cost of Debt of CIR SpA - Compagnie Industriali Riunite (CIR.MI) is 4.25%.

Range Selected
Cost of equity 14.60% - 18.60% 16.60%
Tax rate 30.40% - 36.90% 33.65%
Cost of debt 4.00% - 4.50% 4.25%
WACC 6.6% - 7.9% 7.2%
WACC

CIR.MI WACC calculation

Category Low High
Long-term bond rate 3.7% 4.2%
Equity market risk premium 8.3% 9.3%
Adjusted beta 1.32 1.5
Additional risk adjustments 0.0% 0.5%
Cost of equity 14.60% 18.60%
Tax rate 30.40% 36.90%
Debt/Equity ratio 2.13 2.13
Cost of debt 4.00% 4.50%
After-tax WACC 6.6% 7.9%
Selected WACC 7.2%

CIR.MI'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 CIR.MI:

cost_of_equity (16.60%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (1.32) + 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.