MDM.PA
Maisons du Monde SA
Price:  
2.33 
EUR
Volume:  
32,435.00
France | Specialty Retail
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MDM.PA WACC - Weighted Average Cost of Capital

The WACC of Maisons du Monde SA (MDM.PA) is 3.8%.

The Cost of Equity of Maisons du Monde SA (MDM.PA) is 11.45%.
The Cost of Debt of Maisons du Monde SA (MDM.PA) is 4.25%.

Range Selected
Cost of equity 9.40% - 13.50% 11.45%
Tax rate 32.10% - 36.00% 34.05%
Cost of debt 4.00% - 4.50% 4.25%
WACC 3.5% - 4.1% 3.8%
WACC

MDM.PA WACC calculation

Category Low High
Long-term bond rate 3.0% 3.5%
Equity market risk premium 5.8% 6.8%
Adjusted beta 1.1 1.39
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.40% 13.50%
Tax rate 32.10% 36.00%
Debt/Equity ratio 7.5 7.5
Cost of debt 4.00% 4.50%
After-tax WACC 3.5% 4.1%
Selected WACC 3.8%

MDM.PA'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 MDM.PA:

cost_of_equity (11.45%) = risk_free_rate (3.25%) + equity_risk_premium (6.30%) * adjusted_beta (1.1) + 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.