EDI.WA WACC - Weighted Average Cost of Capital

The WACC of ED Invest SA (EDI.WA) is 9.9%.

The Cost of Equity of ED Invest SA (EDI.WA) is 9.40%.

The Cost of Debt of ED Invest SA (EDI.WA) is 17.65%.

	Range	Selected
Cost of equity	8.40% - 10.40%	9.40%
Tax rate	19.20% - 21.40%	20.30%
Cost of debt	6.70% - 28.60%	17.65%
WACC	8.1% - 11.6%	9.9%

WACC

EDI.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.46	0.52

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.40%	10.40%

Tax rate	19.20%	21.40%
Debt/Equity ratio	0.11	0.11
Cost of debt	6.70%	28.60%

After-tax WACC	8.1%	11.6%


Selected WACC	9.9%

EDI.WA'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 EDI.WA:

cost_of_equity (9.40%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.46) + 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.