ENEL.MI
Enel SpA
Price:  
7.96 
EUR
Volume:  
18,729,392
Italy | Electric Utilities

ENEL.MI WACC - Weighted Average Cost of Capital

The WACC of Enel SpA (ENEL.MI) is 9.3%.

The Cost of Equity of Enel SpA (ENEL.MI) is 11%.
The Cost of Debt of Enel SpA (ENEL.MI) is 11.15%.

RangeSelected
Cost of equity9.5% - 12.5%11%
Tax rate32.5% - 35.2%33.85%
Cost of debt6.9% - 15.4%11.15%
WACC7.2% - 11.3%9.3%
WACC

ENEL.MI WACC calculation

CategoryLowHigh
Long-term bond rate3.7%4.2%
Equity market risk premium8.3%9.3%
Adjusted beta0.70.84
Additional risk adjustments0.0%0.5%
Cost of equity9.5%12.5%
Tax rate32.5%35.2%
Debt/Equity ratio
0.880.88
Cost of debt6.9%15.4%
After-tax WACC7.2%11.3%
Selected WACC9.3%

ENEL.MI'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 ENEL.MI:

cost_of_equity (11.00%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.7) + 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.