MHN.L WACC - Weighted Average Cost of Capital
The WACC of Menhaden PLC (MHN.L) is 8.2%.
| Range | Selected | |
| Cost of equity | 9.9% - 13.0% | 11.45% |
| Tax rate | 0.4% - 0.4% | 0.4% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.4% - 9.0% | 8.2% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.98 | 1.15 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.9% | 13.0% |
| Tax rate | 0.4% | 0.4% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.4% | 9.0% |
| Selected WACC | 8.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MHN.L | Menhaden PLC | 0.85 | 0.95 | 0.51 |
| AIF.L | Acorn Income Fund Ltd | 0.35 | 1.18 | 0.88 |
| AJOT.L | AVI Japan Opportunity Trust PLC | 0.07 | 0.5 | 0.47 |
| ARTL.L | Alpha Real Trust Ltd | 0.07 | 0.53 | 0.5 |
| BERI.L | Blackrock Energy and Resources Income Trust PLC | 0.21 | 1.37 | 1.14 |
| BRLA.L | Blackrock Latin American Investment Trust PLC | 0.02 | 1.35 | 1.32 |
| EBE.DE | aifinyo AG | 0.36 | -0.16 | -0.12 |
| EJFI.L | EJF Investments Ltd | 0.26 | 0.05 | 0.04 |
| GPM.L | Golden Prospect Precious Metals Ltd | 0.07 | 0.8 | 0.74 |
| MCT.L | Middlefield Canadian Income PCC | 0.23 | 0.65 | 0.53 |
| RMDL.L | RM Secured Direct Lending PLC | 0.2 | 0.51 | 0.42 |
| Low | High | |
| Unlevered beta | 0.5 | 0.53 |
| Relevered beta | 0.97 | 1.22 |
| Adjusted relevered beta | 0.98 | 1.15 |
MHN.L'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 MHN.L:
cost_of_equity (11.45%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.98) + 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.