FDJ.PA WACC - Weighted Average Cost of Capital

The WACC of La Francaise des Jeux SA (FDJ.PA) is 7.4%.

The Cost of Equity of La Francaise des Jeux SA (FDJ.PA) is 7.80%.

The Cost of Debt of La Francaise des Jeux SA (FDJ.PA) is 4.25%.

	Range	Selected
Cost of equity	6.80% - 8.80%	7.80%
Tax rate	26.40% - 27.50%	26.95%
Cost of debt	4.00% - 4.50%	4.25%
WACC	6.5% - 8.4%	7.4%

WACC

FDJ.PA WACC calculation

Category	Low	High

Long-term bond rate	3.0%	3.5%
Equity market risk premium	5.8%	6.8%
Adjusted beta	0.65	0.71

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.80%	8.80%

Tax rate	26.40%	27.50%
Debt/Equity ratio	0.08	0.08
Cost of debt	4.00%	4.50%

After-tax WACC	6.5%	8.4%


Selected WACC	7.4%

FDJ.PA'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 FDJ.PA:

cost_of_equity (7.80%) = risk_free_rate (3.25%) + equity_risk_premium (6.30%) * adjusted_beta (0.65) + 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.