ELAL.TA WACC - Weighted Average Cost of Capital
The WACC of El Al Israel Airlines Ltd (ELAL.TA) is 7.4%.
| Range | Selected | |
| Cost of equity | 7.1% - 9.0% | 8.05% |
| Tax rate | 6.2% - 11.9% | 9.05% |
| Cost of debt | 4.1% - 5.4% | 4.75% |
| WACC | 6.5% - 8.3% | 7.4% |
| Category | Low | High |
| Long-term bond rate | 4.8% | 5.3% |
| Equity market risk premium | 5.6% | 6.6% |
| Adjusted beta | 0.4 | 0.48 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.1% | 9.0% |
| Tax rate | 6.2% | 11.9% |
| Debt/Equity ratio | 0.21 | 0.21 |
| Cost of debt | 4.1% | 5.4% |
| After-tax WACC | 6.5% | 8.3% |
| Selected WACC | 7.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ELAL.TA | El Al Israel Airlines Ltd | 0.21 | -0.35 | -0.29 |
| 003490.KS | Korean Air Lines Co Ltd | 2.12 | 0.28 | 0.09 |
| 020560.KS | Asiana Airlines Inc | 3.24 | 0.35 | 0.09 |
| 200152.SZ | Shandong Airlines Co Ltd | 26.15 | -0.27 | -0.01 |
| 2610.TW | China Airlines Ltd | 0.73 | 0.51 | 0.3 |
| 2618.TW | Eva Airways Corp | 0.27 | 0.36 | 0.29 |
| 293.HK | Cathay Pacific Airways Ltd | 0.9 | 0.2 | 0.11 |
| AFLT.ME | Aeroflot-Rossiyskiye Avialinii PAO | 3.52 | -0.23 | -0.05 |
| AIR.NZ | Air New Zealand Ltd | 1.43 | 0.89 | 0.38 |
| INDIGO.NS | Interglobe Aviation Ltd | 0.22 | 1.36 | 1.13 |
| JETAIRWAYS.NS | Jet Airways (India) Ltd | 21.65 | -0.14 | -0.01 |
| Low | High | |
| Unlevered beta | 0.09 | 0.11 |
| Relevered beta | 0.1 | 0.22 |
| Adjusted relevered beta | 0.4 | 0.48 |
ELAL.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 ELAL.TA:
cost_of_equity (8.05%) = risk_free_rate (5.05%) + equity_risk_premium (6.10%) * adjusted_beta (0.4) + 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.