The WACC of Heliospectra AB (publ) (HELIO.ST) is 6.2%.
| Range | Selected | |
| Cost of equity | 5.30% - 7.30% | 6.30% |
| Tax rate | 20.60% - 20.90% | 20.75% |
| Cost of debt | 7.00% - 7.00% | 7.00% |
| WACC | 5.3% - 7.0% | 6.2% |
| Category | Low | High |
| Long-term bond rate | 2.5% | 3.0% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.45 | 0.53 |
| Additional risk adjustments | 0.5% | 1.0% |
| Cost of equity | 5.30% | 7.30% |
| Tax rate | 20.60% | 20.90% |
| Debt/Equity ratio | 0.21 | 0.21 |
| Cost of debt | 7.00% | 7.00% |
| After-tax WACC | 5.3% | 7.0% |
| Selected WACC | 6.2% | |
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 HELIO.ST:
cost_of_equity (6.30%) = risk_free_rate (2.75%) + equity_risk_premium (5.60%) * adjusted_beta (0.45) + 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.