EDR.MC WACC - Weighted Average Cost of Capital

The WACC of eDreams Odigeo SA (EDR.MC) is 7.6%.

The Cost of Equity of eDreams Odigeo SA (EDR.MC) is 8.50%.

The Cost of Debt of eDreams Odigeo SA (EDR.MC) is 5.90%.

	Range	Selected
Cost of equity	6.30% - 10.70%	8.50%
Tax rate	8.70% - 13.10%	10.90%
Cost of debt	5.10% - 6.70%	5.90%
WACC	5.8% - 9.3%	7.6%

WACC

EDR.MC WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	7.4%	8.4%
Adjusted beta	0.43	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.30%	10.70%

Tax rate	8.70%	13.10%
Debt/Equity ratio	0.4	0.4
Cost of debt	5.10%	6.70%

After-tax WACC	5.8%	9.3%


Selected WACC	7.6%

EDR.MC'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 EDR.MC:

cost_of_equity (8.50%) = risk_free_rate (3.35%) + equity_risk_premium (7.90%) * adjusted_beta (0.43) + 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.