EVROF.AT WACC - Weighted Average Cost of Capital

The WACC of Evrofarma SA (EVROF.AT) is 7.5%.

The Cost of Equity of Evrofarma SA (EVROF.AT) is 9.30%.

The Cost of Debt of Evrofarma SA (EVROF.AT) is 5.35%.

	Range	Selected
Cost of equity	7.40% - 11.20%	9.30%
Tax rate	15.10% - 19.60%	17.35%
Cost of debt	5.20% - 5.50%	5.35%
WACC	6.4% - 8.7%	7.5%

WACC

EVROF.AT WACC calculation

Category	Low	High

Long-term bond rate	3.3%	3.8%
Equity market risk premium	8.8%	9.8%
Adjusted beta	0.47	0.7

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.40%	11.20%

Tax rate	15.10%	19.60%
Debt/Equity ratio	0.56	0.56
Cost of debt	5.20%	5.50%

After-tax WACC	6.4%	8.7%


Selected WACC	7.5%

EVROF.AT'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 EVROF.AT:

cost_of_equity (9.30%) = risk_free_rate (3.55%) + equity_risk_premium (9.30%) * adjusted_beta (0.47) + 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.