FCT.MI WACC - Weighted Average Cost of Capital

The WACC of Fincantieri SpA (FCT.MI) is 9.4%.

The Cost of Equity of Fincantieri SpA (FCT.MI) is 11.40%.

The Cost of Debt of Fincantieri SpA (FCT.MI) is 6.65%.

	Range	Selected
Cost of equity	10.30% - 12.50%	11.40%
Tax rate	20.90% - 25.20%	23.05%
Cost of debt	6.00% - 7.30%	6.65%
WACC	8.5% - 10.3%	9.4%

WACC

FCT.MI WACC calculation

Category	Low	High

Long-term bond rate	3.7%	4.2%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.8	0.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.30%	12.50%

Tax rate	20.90%	25.20%
Debt/Equity ratio	0.47	0.47
Cost of debt	6.00%	7.30%

After-tax WACC	8.5%	10.3%


Selected WACC	9.4%

FCT.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 FCT.MI:

cost_of_equity (11.40%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.8) + 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.