KNOW.ST WACC - Weighted Average Cost of Capital

The WACC of Knowit AB (publ) (KNOW.ST) is 6.6%.

The Cost of Equity of Knowit AB (publ) (KNOW.ST) is 7.50%.

The Cost of Debt of Knowit AB (publ) (KNOW.ST) is 4.25%.

	Range	Selected
Cost of equity	6.10% - 8.90%	7.50%
Tax rate	20.40% - 21.20%	20.80%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.5% - 7.8%	6.6%

WACC

KNOW.ST WACC calculation

Category	Low	High

Long-term bond rate	2.5%	3.0%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.71	0.88

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.10%	8.90%

Tax rate	20.40%	21.20%
Debt/Equity ratio	0.26	0.26
Cost of debt	4.00%	4.50%

After-tax WACC	5.5%	7.8%


Selected WACC	6.6%

KNOW.ST'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 KNOW.ST:

cost_of_equity (7.50%) = risk_free_rate (2.75%) + equity_risk_premium (5.60%) * adjusted_beta (0.71) + 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.