IXX.DE WACC - Weighted Average Cost of Capital

The WACC of init innovation in traffic systems SE (IXX.DE) is 6.5%.

The Cost of Equity of init innovation in traffic systems SE (IXX.DE) is 7.30%.

The Cost of Debt of init innovation in traffic systems SE (IXX.DE) is 4.25%.

	Range	Selected
Cost of equity	6.30% - 8.30%	7.30%
Tax rate	20.90% - 22.80%	21.85%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.7% - 7.4%	6.5%

WACC

IXX.DE WACC calculation

Category	Low	High

Long-term bond rate	2.8%	3.3%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.68	0.74

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.30%	8.30%

Tax rate	20.90%	22.80%
Debt/Equity ratio	0.23	0.23
Cost of debt	4.00%	4.50%

After-tax WACC	5.7%	7.4%


Selected WACC	6.5%

IXX.DE'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 IXX.DE:

cost_of_equity (7.30%) = risk_free_rate (3.05%) + equity_risk_premium (5.60%) * adjusted_beta (0.68) + 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.