DRAL.TA WACC - Weighted Average Cost of Capital

The WACC of Dor Alon Energy in Israel 1988 Ltd (DRAL.TA) is 10.4%.

The Cost of Equity of Dor Alon Energy in Israel 1988 Ltd (DRAL.TA) is 12.75%.

The Cost of Debt of Dor Alon Energy in Israel 1988 Ltd (DRAL.TA) is 10.40%.

	Range	Selected
Cost of equity	9.90% - 15.60%	12.75%
Tax rate	10.60% - 14.10%	12.35%
Cost of debt	4.20% - 16.60%	10.40%
WACC	6.0% - 14.8%	10.4%

WACC

DRAL.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.83	1.37

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.90%	15.60%

Tax rate	10.60%	14.10%
Debt/Equity ratio	1.76	1.76
Cost of debt	4.20%	16.60%

After-tax WACC	6.0%	14.8%


Selected WACC	10.4%

DRAL.TA'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 DRAL.TA:

cost_of_equity (12.75%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.83) + 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.