The WACC of Cimentas Izmir Cimento Fabrikasi TAS (CMENT.IS) is 29.6%.
| Range | Selected | |
| Cost of equity | 27.40% - 31.40% | 29.40% |
| Tax rate | 7.80% - 38.10% | 22.95% |
| Cost of debt | 7.00% - 142.10% | 74.55% |
| WACC | 27.2% - 32.0% | 29.6% |
| Category | Low | High |
| Long-term bond rate | 21.4% | 21.9% |
| Equity market risk premium | 10.2% | 11.2% |
| Adjusted beta | 0.59 | 0.81 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 27.40% | 31.40% |
| Tax rate | 7.80% | 38.10% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 7.00% | 142.10% |
| After-tax WACC | 27.2% | 32.0% |
| Selected WACC | 29.6% | |
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 CMENT.IS:
cost_of_equity (29.40%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.59) + 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.