GZT.TA WACC - Weighted Average Cost of Capital

The WACC of Gazit Globe Ltd (GZT.TA) is 6.6%.

The Cost of Equity of Gazit Globe Ltd (GZT.TA) is 13.45%.

The Cost of Debt of Gazit Globe Ltd (GZT.TA) is 8.20%.

	Range	Selected
Cost of equity	11.10% - 15.80%	13.45%
Tax rate	32.70% - 37.80%	35.25%
Cost of debt	4.00% - 12.40%	8.20%
WACC	4.1% - 9.1%	6.6%

WACC

GZT.TA WACC calculation

Category	Low	High

Long-term bond rate	3.0%	3.5%
Equity market risk premium	5.4%	6.4%
Adjusted beta	1.5	1.83

Additional risk adjustments	0.0%	0.5%
Cost of equity	11.10%	15.80%

Tax rate	32.70%	37.80%
Debt/Equity ratio	5.08	5.08
Cost of debt	4.00%	12.40%

After-tax WACC	4.1%	9.1%


Selected WACC	6.6%

GZT.TA'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 GZT.TA:

cost_of_equity (13.45%) = risk_free_rate (3.25%) + equity_risk_premium (5.90%) * adjusted_beta (1.5) + 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.