CREI.L WACC - Weighted Average Cost of Capital
The WACC of Custodian REIT PLC (CREI.L) is 7.2%.
| Range | Selected | |
| Cost of equity | 7.6% - 10.0% | 8.8% |
| Tax rate | 19.0% - 19.0% | 19% |
| Cost of debt | 4.0% - 5.5% | 4.75% |
| WACC | 6.2% - 8.2% | 7.2% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.6 | 0.71 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.6% | 10.0% |
| Tax rate | 19.0% | 19.0% |
| Debt/Equity ratio | 0.47 | 0.47 |
| Cost of debt | 4.0% | 5.5% |
| After-tax WACC | 6.2% | 8.2% |
| Selected WACC | 7.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| CREI.L | Custodian REIT PLC | 0.47 | 0.87 | 0.63 |
| DGGYO.IS | Dogus Gayrimenkul Yatirim Ortakligi AS | 0.42 | 0.36 | 0.27 |
| IMDA.PA | Immobiliere Dassault SA | 0.73 | 0.05 | 0.03 |
| LEAS.BR | Leasinvest Real Estate Comm VA | 1 | 0.6 | 0.33 |
| LRE.MC | Lar Espana Real Estate SOCIMI SA | 0.94 | 0.11 | 0.06 |
| NUGYO.IS | Nurol Gayrimenkul Yatirim Ortakligi AS | 0.41 | 1.07 | 0.8 |
| PAT.PA | Patrimoine et Commerce SCA | 1.09 | 0.46 | 0.25 |
| PCTN.L | Picton Property Income Ltd | 0.5 | 0.76 | 0.54 |
| RDI.L | RDI Reit PLC | 1.42 | 1.25 | 0.58 |
| SLI.L | Standard Life Investments Property Income Trust Ltd | 0.34 | 0.38 | 0.3 |
| Low | High | |
| Unlevered beta | 0.29 | 0.42 |
| Relevered beta | 0.4 | 0.57 |
| Adjusted relevered beta | 0.6 | 0.71 |
CREI.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 CREI.L:
cost_of_equity (8.80%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.6) + 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.