The WACC of Globaltrans Investment PLC (GLTR.L) is 6.4%.
Range | Selected | |
Cost of equity | 5.7% - 9.3% | 7.5% |
Tax rate | 23.5% - 24.2% | 23.85% |
Cost of debt | 4.0% - 8.5% | 6.25% |
WACC | 4.7% - 8.2% | 6.4% |
Category | Low | High |
Long-term bond rate | 1.7% | 2.2% |
Equity market risk premium | 4.8% | 5.8% |
Adjusted beta | 0.83 | 1.13 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 5.7% | 9.3% |
Tax rate | 23.5% | 24.2% |
Debt/Equity ratio | 0.6 | 0.6 |
Cost of debt | 4.0% | 8.5% |
After-tax WACC | 4.7% | 8.2% |
Selected WACC | 6.4% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
GLTR.L | Globaltrans Investment PLC | 0.6 | 0.99 | 0.68 |
BVZN.SW | BVZ Holding AG | 2.08 | 0.29 | 0.11 |
FNM.MI | FNM SpA | 5.37 | 0.35 | 0.07 |
JFN.SW | Jungfraubahn Holding AG | 0.1 | 0.51 | 0.47 |
METRO.IS | Metro Ticari ve Mali Yatirimlar Holding AS | 0 | 0.67 | 0.67 |
NEX.L | National Express Group PLC | 2.76 | 1.47 | 0.47 |
PKP.WA | PKP Cargo SA | 3.95 | 0.52 | 0.13 |
NSC | Norfolk Southern Corp | 0.3 | 0.85 | 0.69 |
UNP | Union Pacific Corp | 0.23 | 0.66 | 0.57 |
URAL | United Rail Inc | 76229.77 | 0.58 | 0 |
Low | High | |
Unlevered beta | 0.33 | 0.51 |
Relevered beta | 0.75 | 1.19 |
Adjusted relevered beta | 0.83 | 1.13 |
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 GLTR.L:
cost_of_equity (7.50%) = risk_free_rate (1.95%) + equity_risk_premium (5.30%) * adjusted_beta (0.83) + 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.