LXFR
Luxfer Holdings PLC
Price:  
11.43 
USD
Volume:  
82,022.00
United Kingdom | Machinery
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

LXFR WACC - Weighted Average Cost of Capital

The WACC of Luxfer Holdings PLC (LXFR) is 9.1%.

The Cost of Equity of Luxfer Holdings PLC (LXFR) is 9.80%.
The Cost of Debt of Luxfer Holdings PLC (LXFR) is 5.95%.

Range Selected
Cost of equity 8.30% - 11.30% 9.80%
Tax rate 23.70% - 27.30% 25.50%
Cost of debt 4.80% - 7.10% 5.95%
WACC 7.7% - 10.5% 9.1%
WACC

LXFR WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.96 1.14
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.30% 11.30%
Tax rate 23.70% 27.30%
Debt/Equity ratio 0.15 0.15
Cost of debt 4.80% 7.10%
After-tax WACC 7.7% 10.5%
Selected WACC 9.1%

LXFR'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 LXFR:

cost_of_equity (9.80%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.96) + 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.