The WACC of Credit Suisse Group AG (CSGN.SW) is 5.4%.
Range | Selected | |
Cost of equity | 44.1% - 115.6% | 79.85% |
Tax rate | 16.8% - 18.0% | 17.4% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 4.8% - 5.9% | 5.4% |
Category | Low | High |
Long-term bond rate | 1.0% | 1.5% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 8.46 | 18.62 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 44.1% | 115.6% |
Tax rate | 16.8% | 18.0% |
Debt/Equity ratio | 59.82 | 59.82 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 4.8% | 5.9% |
Selected WACC | 5.4% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
CSGN.SW | Credit Suisse Group AG | 59.82 | 1.47 | 0.03 |
ADV.PA | Advenis SA | 1.19 | 0.49 | 0.25 |
IDM.WA | IDM SA | 0.05 | 0.15 | 0.15 |
INVP.L | Investec PLC | 1.03 | 1.46 | 0.79 |
KN.PA | Natixis SA | 11.41 | 1.22 | 0.12 |
KVIKA.IC | Kvika banki hf | 0.73 | 1.14 | 0.72 |
QLT.L | Quilter PLC | 0.13 | 1.67 | 1.51 |
ROTH.PA | Rothschild & Co SCA | 0.09 | 0.25 | 0.23 |
STJ.L | St. James's Place PLC | 0.11 | 2.04 | 1.88 |
UBSG.SW | UBS Group AG | 3.23 | 1.58 | 0.43 |
Low | High | |
Unlevered beta | 0.24 | 0.55 |
Relevered beta | 12.13 | 27.3 |
Adjusted relevered beta | 8.46 | 18.62 |
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 CSGN.SW:
cost_of_equity (79.85%) = risk_free_rate (1.25%) + equity_risk_premium (5.60%) * adjusted_beta (8.46) + 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.