MTN.JO WACC - Weighted Average Cost of Capital

The WACC of MTN Group Ltd (MTN.JO) is 15.8%.

The Cost of Equity of MTN Group Ltd (MTN.JO) is 20.45%.

The Cost of Debt of MTN Group Ltd (MTN.JO) is 11.55%.

	Range	Selected
Cost of equity	19.40% - 21.50%	20.45%
Tax rate	27.60% - 28.00%	27.80%
Cost of debt	10.40% - 12.70%	11.55%
WACC	14.9% - 16.8%	15.8%

WACC

MTN.JO WACC calculation

Category	Low	High

Long-term bond rate	9.1%	9.6%
Equity market risk premium	9.5%	10.5%
Adjusted beta	1.08	1.08

Additional risk adjustments	0.0%	0.5%
Cost of equity	19.40%	21.50%

Tax rate	27.60%	28.00%
Debt/Equity ratio	0.62	0.62
Cost of debt	10.40%	12.70%

After-tax WACC	14.9%	16.8%


Selected WACC	15.8%

MTN.JO'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 MTN.JO:

cost_of_equity (20.45%) = risk_free_rate (9.35%) + equity_risk_premium (10.00%) * adjusted_beta (1.08) + 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.