HVPE.L WACC - Weighted Average Cost of Capital
The WACC of HarbourVest Global Private Equity Ltd (HVPE.L) is 9.9%.
| Range | Selected | |
| Cost of equity | 9.4% - 11.8% | 10.6% |
| Tax rate | 19.0% - 19.0% | 19% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.8% - 11.0% | 9.9% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.9 | 0.98 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.4% | 11.8% |
| Tax rate | 19.0% | 19.0% |
| Debt/Equity ratio | 0.12 | 0.12 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.8% | 11.0% |
| Selected WACC | 9.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| HVPE.L | HarbourVest Global Private Equity Ltd | 0.12 | 0.85 | 0.78 |
| AGT.L | AVI Global Trust PLC | 0.17 | 1.09 | 0.96 |
| BBGI.L | BBGI SICAV SA | 0 | 0.2 | 0.2 |
| BGFD.L | Baillie Gifford Japan Trust PLC | 0.24 | 0.91 | 0.77 |
| BNKR.L | Bankers Investment Trust PLC | 0.11 | 0.79 | 0.72 |
| GCP.L | GCP Infrastructure Investments Ltd | 0.09 | 0.41 | 0.38 |
| HSL.L | Henderson Smaller Companies Investment Trust PLC | 0.19 | 1.58 | 1.37 |
| JEO.L | European Opportunities Trust PLC | 0.08 | 0.91 | 0.85 |
| MUT.L | Murray Income Trust PLC | 0.14 | 1.04 | 0.94 |
| MYI.L | Murray International Trust PLC | 0.07 | 1.07 | 1.01 |
| Low | High | |
| Unlevered beta | 0.77 | 0.89 |
| Relevered beta | 0.85 | 0.97 |
| Adjusted relevered beta | 0.9 | 0.98 |
HVPE.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 HVPE.L:
cost_of_equity (10.60%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.9) + 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.