KWS.DE WACC - Weighted Average Cost of Capital

The WACC of KWS SAAT SE & Co KgaA (KWS.DE) is 6.7%.

The Cost of Equity of KWS SAAT SE & Co KgaA (KWS.DE) is 7.85%.

The Cost of Debt of KWS SAAT SE & Co KgaA (KWS.DE) is 4.25%.

	Range	Selected
Cost of equity	6.00% - 9.70%	7.85%
Tax rate	24.70% - 26.40%	25.55%
Cost of debt	4.00% - 4.50%	4.25%
WACC	5.3% - 8.1%	6.7%

WACC

KWS.DE WACC calculation

Category	Low	High

Long-term bond rate	2.8%	3.3%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.64	0.97

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.00%	9.70%

Tax rate	24.70%	26.40%
Debt/Equity ratio	0.35	0.35
Cost of debt	4.00%	4.50%

After-tax WACC	5.3%	8.1%


Selected WACC	6.7%

KWS.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 KWS.DE:

cost_of_equity (7.85%) = risk_free_rate (3.05%) + equity_risk_premium (5.60%) * adjusted_beta (0.64) + 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.