EOAN.DE WACC - Weighted Average Cost of Capital

The WACC of E.ON SE (EOAN.DE) is 5.5%.

The Cost of Equity of E.ON SE (EOAN.DE) is 7.65%.

The Cost of Debt of E.ON SE (EOAN.DE) is 4.25%.

	Range	Selected
Cost of equity	6.60% - 8.70%	7.65%
Tax rate	19.80% - 30.50%	25.15%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.0% - 6.0%	5.5%

WACC

EOAN.DE WACC calculation

Category	Low	High

Long-term bond rate	2.8%	3.3%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.76	0.8

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.60%	8.70%

Tax rate	19.80%	30.50%
Debt/Equity ratio	0.96	0.96
Cost of debt	4.00%	4.50%

After-tax WACC	5.0%	6.0%


Selected WACC	5.5%

EOAN.DE'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 EOAN.DE:

cost_of_equity (7.65%) = risk_free_rate (3.05%) + equity_risk_premium (5.60%) * adjusted_beta (0.76) + 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.