LEX.ST
The Lexington Company AB (publ)
Price:  
35 
SEK
Volume:  
49,309
Sweden | Textiles, Apparel & Luxury Goods

LEX.ST WACC - Weighted Average Cost of Capital

The WACC of The Lexington Company AB (publ) (LEX.ST) is 6.9%.

The Cost of Equity of The Lexington Company AB (publ) (LEX.ST) is 9.15%.
The Cost of Debt of The Lexington Company AB (publ) (LEX.ST) is 5%.

RangeSelected
Cost of equity6.7% - 11.6%9.15%
Tax rate3.2% - 8.8%6%
Cost of debt5.0% - 5.0%5%
WACC5.8% - 8.1%6.9%
WACC

LEX.ST WACC calculation

CategoryLowHigh
Long-term bond rate2.3%2.8%
Equity market risk premium4.7%5.7%
Adjusted beta0.921.45
Additional risk adjustments0.0%0.5%
Cost of equity6.7%11.6%
Tax rate3.2%8.8%
Debt/Equity ratio
11
Cost of debt5.0%5.0%
After-tax WACC5.8%8.1%
Selected WACC6.9%

LEX.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 LEX.ST:

cost_of_equity (9.15%) = risk_free_rate (2.55%) + equity_risk_premium (5.20%) * adjusted_beta (0.92) + 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.