LIPI.ST WACC - Weighted Average Cost of Capital
The WACC of Lipidor AB (LIPI.ST) is 4.8%.
| Range | Selected | |
| Cost of equity | 4.6% - 6.7% | 5.65% |
| Tax rate | 20.6% - 20.9% | 20.75% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.3% - 5.3% | 4.8% |
| Category | Low | High |
| Long-term bond rate | 2.5% | 3.0% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.4 | 0.52 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 4.6% | 6.7% |
| Tax rate | 20.6% | 20.9% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.3% | 5.3% |
| Selected WACC | 4.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| LIPI.ST | Lipidor AB | 0.93 | 2.18 | 1.26 |
| ADVIC.PA | Advicenne SA | 0.26 | 1.25 | 1.04 |
| AMYT.L | Amryt Pharma Holdings Ltd | 0.34 | 0.05 | 0.04 |
| FCM.MI | Friulchem SpA | 2.72 | 0.15 | 0.05 |
| INDEX.ST | InDex Pharmaceuticals Holding AB | 0.01 | -0.92 | -0.91 |
| KDEV.ST | Karolinska Development AB | 0.01 | 0.55 | 0.54 |
| MARI.VI | Marinomed Biotech AG | 1 | 0.13 | 0.07 |
| MOB.ST | Moberg Pharma AB (publ) | 0.01 | 0.2 | 0.2 |
| ORX.ST | Orexo AB | 0.92 | 0.28 | 0.16 |
| PRL.MI | Pierrel SpA | 0.28 | 0.18 | 0.15 |
| SHE.MI | Shedir Pharma Srl Unipersonale | 0.15 | -0.16 | -0.14 |
| Low | High | |
| Unlevered beta | 0.07 | 0.16 |
| Relevered beta | 0.1 | 0.28 |
| Adjusted relevered beta | 0.4 | 0.52 |
LIPI.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 LIPI.ST:
cost_of_equity (5.65%) = risk_free_rate (2.75%) + equity_risk_premium (5.60%) * adjusted_beta (0.4) + 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.