CRST.L WACC - Weighted Average Cost of Capital
The WACC of Crest Nicholson Holdings PLC (CRST.L) is 7.7%.
| Range | Selected | |
| Cost of equity | 6.9% - 9.9% | 8.4% |
| Tax rate | 20.2% - 21.4% | 20.8% |
| Cost of debt | 5.1% - 5.8% | 5.45% |
| WACC | 6.4% - 9.0% | 7.7% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.48 | 0.7 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.9% | 9.9% |
| Tax rate | 20.2% | 21.4% |
| Debt/Equity ratio | 0.2 | 0.2 |
| Cost of debt | 5.1% | 5.8% |
| After-tax WACC | 6.4% | 9.0% |
| Selected WACC | 7.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| CRST.L | Crest Nicholson Holdings PLC | 0.2 | 1.85 | 1.6 |
| BOOT.L | Henry Boot PLC | 0.31 | 0.04 | 0.03 |
| CSP.L | Countryside Properties PLC | 0.07 | 1.94 | 1.84 |
| DOM.WA | Dom Development SA | 0.12 | 0.42 | 0.38 |
| H5E.DE | HELMA Eigenheimbau AG | 222.16 | -0.76 | 0 |
| HEXA.PA | Hexaom SA | 1.06 | 1.14 | 0.62 |
| HOME.MC | Neinor Homes SA | 0.49 | 0.39 | 0.28 |
| KOF.PA | Kaufman & Broad SA | 0.23 | 0.73 | 0.62 |
| NTBR.L | Northern Bear PLC | 0.55 | -0.25 | -0.18 |
| TRAF.L | Trafalgar Property Group PLC | 10.36 | 0.66 | 0.07 |
| Low | High | |
| Unlevered beta | 0.2 | 0.48 |
| Relevered beta | 0.22 | 0.55 |
| Adjusted relevered beta | 0.48 | 0.7 |
CRST.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 CRST.L:
cost_of_equity (8.40%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.48) + 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.