MAP.MC WACC - Weighted Average Cost of Capital
The WACC of Mapfre SA (MAP.MC) is 8.6%.
| Range | Selected | |
| Cost of equity | 8.4% - 11.3% | 9.85% |
| Tax rate | 23.5% - 23.9% | 23.7% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.5% - 9.8% | 8.6% |
| Category | Low | High |
| Long-term bond rate | 3.1% | 3.6% |
| Equity market risk premium | 7.4% | 8.4% |
| Adjusted beta | 0.71 | 0.85 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.4% | 11.3% |
| Tax rate | 23.5% | 23.9% |
| Debt/Equity ratio | 0.25 | 0.25 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.5% | 9.8% |
| Selected WACC | 8.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MAP.MC | Mapfre SA | 0.25 | 0.89 | 0.75 |
| BALN.SW | Baloise Holding AG | 0.28 | 0.57 | 0.47 |
| HELN.SW | Helvetia Holding AG | 0.2 | 0.56 | 0.48 |
| PZU.WA | Powszechny Zaklad Ubezpieczen SA | 6.86 | 0.9 | 0.14 |
| SAMPO.HE | Sampo plc | 0.11 | 0.49 | 0.45 |
| SJOVA.IC | Sjova-Almennar tryggingar hf | 0.02 | 1.02 | 1 |
| TURSG.IS | Turkiye Sigorta AS | 0 | 1.05 | 1.05 |
| UNI.MI | Unipol Gruppo SpA | 0.47 | 1.08 | 0.79 |
| US.MI | UnipolSai Assicurazioni SpA | 0.44 | 0.4 | 0.3 |
| VIG.VI | Vienna Insurance Group AG Wiener Versicherung Gruppe | 0.31 | 0.73 | 0.59 |
| Low | High | |
| Unlevered beta | 0.48 | 0.65 |
| Relevered beta | 0.57 | 0.78 |
| Adjusted relevered beta | 0.71 | 0.85 |
MAP.MC'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 MAP.MC:
cost_of_equity (9.85%) = risk_free_rate (3.35%) + equity_risk_premium (7.90%) * adjusted_beta (0.71) + 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.