MGN.OL WACC - Weighted Average Cost of Capital
The WACC of Magnora ASA (MGN.OL) is 8.5%.
| Range | Selected | |
| Cost of equity | 7.0% - 10.0% | 8.5% |
| Tax rate | 9.2% - 15.0% | 12.1% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.0% - 10.0% | 8.5% |
| Category | Low | High |
| Long-term bond rate | 3.3% | 3.8% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.71 | 0.93 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.0% | 10.0% |
| Tax rate | 9.2% | 15.0% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.0% | 10.0% |
| Selected WACC | 8.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MGN.OL | Magnora ASA | 0 | 0.52 | 0.52 |
| ESOA | Energy Services Of America Corp | 0.21 | 1.17 | 0.99 |
| EMGS.OL | Electromagnetic Geoservices ASA | 0.88 | 1.68 | 0.96 |
| GMS.L | Gulf Marine Services PLC | 0.79 | 1.45 | 0.86 |
| GTC.L | Getech Group PLC | 0.16 | -0.62 | -0.54 |
| HTG.L | Hunting PLC | 0.23 | 1.86 | 1.55 |
| NORTH.OL | North Energy ASA | 0.01 | 0.6 | 0.6 |
| NTQ.L | Enteq Upstream PLC | 0.42 | -0.81 | -0.6 |
| TRE.MC | Tecnicas Reunidas SA | 0.57 | 1.5 | 1 |
| VLS.L | Velocys PLC | 0.09 | -0.05 | -0.04 |
| Low | High | |
| Unlevered beta | 0.57 | 0.9 |
| Relevered beta | 0.57 | 0.9 |
| Adjusted relevered beta | 0.71 | 0.93 |
MGN.OL'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 MGN.OL:
cost_of_equity (8.50%) = risk_free_rate (3.55%) + equity_risk_premium (5.60%) * 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.