GMAA.L WACC - Weighted Average Cost of Capital
The WACC of Gama Aviation PLC (GMAA.L) is 8.2%.
| Range | Selected | |
| Cost of equity | 8.7% - 12.7% | 10.7% |
| Tax rate | 7.4% - 13.0% | 10.2% |
| Cost of debt | 4.0% - 9.2% | 6.6% |
| WACC | 6.1% - 10.3% | 8.2% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.78 | 1.1 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.7% | 12.7% |
| Tax rate | 7.4% | 13.0% |
| Debt/Equity ratio | 1.06 | 1.06 |
| Cost of debt | 4.0% | 9.2% |
| After-tax WACC | 6.1% | 10.3% |
| Selected WACC | 8.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| GMAA.L | Gama Aviation PLC | 1.06 | -0.72 | -0.37 |
| AEGN.AT | Aegean Airlines SA | 1.22 | 1.21 | 0.58 |
| AIR.L | Air Partner PLC | 0.09 | 1.04 | 0.97 |
| ENT.WA | Enter Air SA | 1.44 | 0.49 | 0.21 |
| EZJ.L | Easyjet PLC | 0.79 | 1.06 | 0.61 |
| FIA1S.HE | Finnair Plc | 3.5 | 1.51 | 0.36 |
| IAG.L | International Consolidated Airlines Group SA | 0.96 | 1.47 | 0.79 |
| NAS.OL | Norwegian Air Shuttle ASA | 1.09 | -0.08 | -0.04 |
| PGSUS.IS | Pegasus Hava Tasimaciligi AS | 2.14 | 1.82 | 0.62 |
| WIZZ.L | Wizz Air Holdings PLC | 3.1 | 1.23 | 0.32 |
| Low | High | |
| Unlevered beta | 0.35 | 0.59 |
| Relevered beta | 0.67 | 1.15 |
| Adjusted relevered beta | 0.78 | 1.1 |
GMAA.L'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 GMAA.L:
cost_of_equity (10.70%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.78) + 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.