HEX.OL
Hexagon Composites ASA
Price:  
17.12 
NOK
Volume:  
999,155.00
Norway | Machinery
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HEX.OL WACC - Weighted Average Cost of Capital

The WACC of Hexagon Composites ASA (HEX.OL) is 7.4%.

The Cost of Equity of Hexagon Composites ASA (HEX.OL) is 8.20%.
The Cost of Debt of Hexagon Composites ASA (HEX.OL) is 7.40%.

Range Selected
Cost of equity 6.60% - 9.80% 8.20%
Tax rate 7.90% - 35.80% 21.85%
Cost of debt 7.00% - 7.80% 7.40%
WACC 6.5% - 8.2% 7.4%
WACC

HEX.OL WACC calculation

Category Low High
Long-term bond rate 3.3% 3.8%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.64 0.9
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.60% 9.80%
Tax rate 7.90% 35.80%
Debt/Equity ratio 0.53 0.53
Cost of debt 7.00% 7.80%
After-tax WACC 6.5% 8.2%
Selected WACC 7.4%

HEX.OL'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 HEX.OL:

cost_of_equity (8.20%) = risk_free_rate (3.55%) + equity_risk_premium (5.60%) * adjusted_beta (0.64) + 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.