LBW.WA
Lubawa SA
Price:  
8.75 
PLN
Volume:  
797,676.00
Poland | Aerospace & Defense
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LBW.WA WACC - Weighted Average Cost of Capital

The WACC of Lubawa SA (LBW.WA) is 11.3%.

The Cost of Equity of Lubawa SA (LBW.WA) is 11.35%.
The Cost of Debt of Lubawa SA (LBW.WA) is 6.10%.

Range Selected
Cost of equity 10.20% - 12.50% 11.35%
Tax rate 18.20% - 18.60% 18.40%
Cost of debt 6.10% - 6.10% 6.10%
WACC 10.2% - 12.4% 11.3%
WACC

LBW.WA WACC calculation

Category Low High
Long-term bond rate 5.5% 6.0%
Equity market risk premium 6.3% 7.3%
Adjusted beta 0.75 0.82
Additional risk adjustments 0.0% 0.5%
Cost of equity 10.20% 12.50%
Tax rate 18.20% 18.60%
Debt/Equity ratio 0.01 0.01
Cost of debt 6.10% 6.10%
After-tax WACC 10.2% 12.4%
Selected WACC 11.3%

LBW.WA'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 LBW.WA:

cost_of_equity (11.35%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.75) + 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.