DIB.MI WACC - Weighted Average Cost of Capital
The WACC of Digital Bros SpA (DIB.MI) is 8.8%.
| Range | Selected | |
| Cost of equity | 7.8% - 12.2% | 10% |
| Tax rate | 24.2% - 28.1% | 26.15% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.0% - 10.6% | 8.8% |
| Category | Low | High |
| Long-term bond rate | 3.7% | 4.2% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.5 | 0.81 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.8% | 12.2% |
| Tax rate | 24.2% | 28.1% |
| Debt/Equity ratio | 0.23 | 0.23 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.0% | 10.6% |
| Selected WACC | 8.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| DIB.MI | Digital Bros SpA | 0.23 | 0.59 | 0.5 |
| 11B.WA | 11 Bit Studios SA | 0.01 | 0.79 | 0.79 |
| CFG.WA | Creativeforge Games SA | 0 | 0.05 | 0.05 |
| G5EN.ST | G5 Entertainment AB (publ) | 0 | 1.06 | 1.06 |
| GMR.L | Gaming Realms PLC | 0.01 | -0.2 | -0.2 |
| M8G.DE | MEDIA AND GAMES INVEST PLC | 1.26 | 0.39 | 0.2 |
| MOV.WA | Movie Games SA | 0.01 | -0.35 | -0.35 |
| NITRO.ST | Nitro Games Oyj | 0.91 | 0.19 | 0.12 |
| REMEDY.HE | Remedy Entertainment Oyj | 0.16 | 1.23 | 1.11 |
| SUMO.L | Sumo Group PLC | 0.02 | 1.29 | 1.28 |
| Low | High | |
| Unlevered beta | 0.17 | 0.62 |
| Relevered beta | 0.25 | 0.72 |
| Adjusted relevered beta | 0.5 | 0.81 |
DIB.MI'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 DIB.MI:
cost_of_equity (10.00%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.5) + 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.