ESP.AS WACC - Weighted Average Cost of Capital

The WACC of Esperite NV (ESP.AS) is 8.8%.

The Cost of Equity of Esperite NV (ESP.AS) is 7.85%.

The Cost of Debt of Esperite NV (ESP.AS) is 9.70%.

	Range	Selected
Cost of equity	5.40% - 10.30%	7.85%
Tax rate	5.50% - 9.40%	7.45%
Cost of debt	7.00% - 12.40%	9.70%
WACC	6.5% - 11.2%	8.8%

WACC

ESP.AS WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.56	1.1

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.40%	10.30%

Tax rate	5.50%	9.40%
Debt/Equity ratio	12.71	12.71
Cost of debt	7.00%	12.40%

After-tax WACC	6.5%	11.2%


Selected WACC	8.8%

ESP.AS'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 ESP.AS:

cost_of_equity (7.85%) = risk_free_rate (2.85%) + equity_risk_premium (5.60%) * adjusted_beta (0.56) + 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.