CLI.L WACC - Weighted Average Cost of Capital

The WACC of CLS Holdings PLC (CLI.L) is 7.1%.

The Cost of Equity of CLS Holdings PLC (CLI.L) is 11.40%.

The Cost of Debt of CLS Holdings PLC (CLI.L) is 6.60%.

	Range	Selected
Cost of equity	10.10% - 12.70%	11.40%
Tax rate	4.70% - 11.00%	7.85%
Cost of debt	4.00% - 9.20%	6.60%
WACC	5.1% - 9.1%	7.1%

WACC

CLI.L WACC calculation

Category	Low	High

Long-term bond rate	4.0%	4.5%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.01	1.11

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.10%	12.70%

Tax rate	4.70%	11.00%
Debt/Equity ratio	3.88	3.88
Cost of debt	4.00%	9.20%

After-tax WACC	5.1%	9.1%


Selected WACC	7.1%

CLI.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 CLI.L:

cost_of_equity (11.40%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (1.01) + 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.