KLR.L WACC - Weighted Average Cost of Capital

The WACC of Keller Group PLC (KLR.L) is 9.4%.

The Cost of Equity of Keller Group PLC (KLR.L) is 11.20%.

The Cost of Debt of Keller Group PLC (KLR.L) is 4.85%.

	Range	Selected
Cost of equity	9.40% - 13.00%	11.20%
Tax rate	21.50% - 24.80%	23.15%
Cost of debt	4.80% - 4.90%	4.85%
WACC	8.1% - 10.8%	9.4%

WACC

KLR.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	1.14

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.40%	13.00%

Tax rate	21.50%	24.80%
Debt/Equity ratio	0.31	0.31
Cost of debt	4.80%	4.90%

After-tax WACC	8.1%	10.8%


Selected WACC	9.4%

KLR.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 KLR.L:

cost_of_equity (11.20%) = 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.