HLG.NZ
Hallenstein Glasson Holdings Ltd
Price:  
8.51 
NZD
Volume:  
13,774
New Zealand | Specialty Retail

HLG.NZ WACC - Weighted Average Cost of Capital

The WACC of Hallenstein Glasson Holdings Ltd (HLG.NZ) is 7.9%.

The Cost of Equity of Hallenstein Glasson Holdings Ltd (HLG.NZ) is 8.5%.
The Cost of Debt of Hallenstein Glasson Holdings Ltd (HLG.NZ) is 5.5%.

RangeSelected
Cost of equity7.3% - 9.7%8.5%
Tax rate28.2% - 29.3%28.75%
Cost of debt4.0% - 7.0%5.5%
WACC6.7% - 9.1%7.9%
WACC

HLG.NZ WACC calculation

CategoryLowHigh
Long-term bond rate4.3%4.8%
Equity market risk premium5.1%6.1%
Adjusted beta0.570.72
Additional risk adjustments0.0%0.5%
Cost of equity7.3%9.7%
Tax rate28.2%29.3%
Debt/Equity ratio
0.150.15
Cost of debt4.0%7.0%
After-tax WACC6.7%9.1%
Selected WACC7.9%

HLG.NZ'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 HLG.NZ:

cost_of_equity (8.50%) = risk_free_rate (4.55%) + equity_risk_premium (5.60%) * adjusted_beta (0.57) + 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.