IMI.L
IMI PLC
Price:  
2,184.00 
GBP
Volume:  
410,620.00
United Kingdom | Machinery
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IMI.L WACC - Weighted Average Cost of Capital

The WACC of IMI PLC (IMI.L) is 10.0%.

The Cost of Equity of IMI PLC (IMI.L) is 10.90%.
The Cost of Debt of IMI PLC (IMI.L) is 4.30%.

Range Selected
Cost of equity 9.50% - 12.30% 10.90%
Tax rate 20.70% - 21.00% 20.85%
Cost of debt 4.00% - 4.60% 4.30%
WACC 8.7% - 11.3% 10.0%
WACC

IMI.L WACC calculation

Category Low High
Long-term bond rate 4.0% 4.5%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.91 1.05
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.50% 12.30%
Tax rate 20.70% 21.00%
Debt/Equity ratio 0.13 0.13
Cost of debt 4.00% 4.60%
After-tax WACC 8.7% 11.3%
Selected WACC 10.0%

IMI.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 IMI.L:

cost_of_equity (10.90%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.91) + 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.