EDR.MC WACC - Weighted Average Cost of Capital

The WACC of eDreams Odigeo SA (EDR.MC) is 10.0%.

The Cost of Equity of eDreams Odigeo SA (EDR.MC) is 15.90%.

The Cost of Debt of eDreams Odigeo SA (EDR.MC) is 5.05%.

	Range	Selected
Cost of equity	13.70% - 18.10%	15.90%
Tax rate	9.40% - 13.10%	11.25%
Cost of debt	4.80% - 5.30%	5.05%
WACC	8.9% - 11.1%	10.0%

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	1.42	1.67

Additional risk adjustments	0.0%	0.5%
Cost of equity	13.70%	18.10%

Tax rate	9.40%	13.10%
Debt/Equity ratio	1.08	1.08
Cost of debt	4.80%	5.30%

After-tax WACC	8.9%	11.1%


Selected WACC	10.0%

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 (15.90%) = risk_free_rate (3.35%) + equity_risk_premium (7.90%) * adjusted_beta (1.42) + 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.