The WACC of Donskoy Zavod Radiodetaley OAO (DZRD.ME) is 19.2%.
| Range | Selected | |
| Cost of equity | 20.10% - 21.90% | 21.00% |
| Tax rate | 31.70% - 37.30% | 34.50% |
| Cost of debt | 4.00% - 32.80% | 18.40% |
| WACC | 16.8% - 21.6% | 19.2% |
| Category | Low | High |
| Long-term bond rate | 15.8% | 16.3% |
| Equity market risk premium | 11.7% | 12.7% |
| Adjusted beta | 0.37 | 0.4 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 20.10% | 21.90% |
| Tax rate | 31.70% | 37.30% |
| Debt/Equity ratio | 0.24 | 0.24 |
| Cost of debt | 4.00% | 32.80% |
| After-tax WACC | 16.8% | 21.6% |
| Selected WACC | 19.2% | |
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 DZRD.ME:
cost_of_equity (21.00%) = risk_free_rate (16.05%) + equity_risk_premium (12.20%) * adjusted_beta (0.37) + 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.