GERHSP.CO WACC - Weighted Average Cost of Capital

The WACC of German High Street Properties A/S (GERHSP.CO) is 6.8%.

The Cost of Equity of German High Street Properties A/S (GERHSP.CO) is 6.35%.

The Cost of Debt of German High Street Properties A/S (GERHSP.CO) is 9.25%.

	Range	Selected
Cost of equity	5.30% - 7.40%	6.35%
Tax rate	16.40% - 23.30%	19.85%
Cost of debt	4.00% - 14.50%	9.25%
WACC	4.5% - 9.1%	6.8%

WACC

GERHSP.CO WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.41	0.52

Additional risk adjustments	0.5%	1.0%
Cost of equity	5.30%	7.40%

Tax rate	16.40%	23.30%
Debt/Equity ratio	0.8	0.8
Cost of debt	4.00%	14.50%

After-tax WACC	4.5%	9.1%


Selected WACC	6.8%

GERHSP.CO'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 GERHSP.CO:

cost_of_equity (6.35%) = risk_free_rate (2.95%) + equity_risk_premium (5.60%) * adjusted_beta (0.41) + 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.