ETTE.HE WACC - Weighted Average Cost of Capital

The WACC of Etteplan Oyj (ETTE.HE) is 5.9%.

The Cost of Equity of Etteplan Oyj (ETTE.HE) is 6.35%.

The Cost of Debt of Etteplan Oyj (ETTE.HE) is 5.50%.

	Range	Selected
Cost of equity	5.50% - 7.20%	6.35%
Tax rate	19.20% - 19.60%	19.40%
Cost of debt	4.00% - 7.00%	5.50%
WACC	4.9% - 6.8%	5.9%

WACC

ETTE.HE WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.7%	6.7%
Adjusted beta	0.39	0.45

Additional risk adjustments	0.5%	1.0%
Cost of equity	5.50%	7.20%

Tax rate	19.20%	19.60%
Debt/Equity ratio	0.33	0.33
Cost of debt	4.00%	7.00%

After-tax WACC	4.9%	6.8%


Selected WACC	5.9%

ETTE.HE'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 ETTE.HE:

cost_of_equity (6.35%) = risk_free_rate (2.95%) + equity_risk_premium (6.20%) * adjusted_beta (0.39) + risk_adjustments (0.75%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.