MTN.JO WACC - Weighted Average Cost of Capital

The WACC of MTN Group Ltd (MTN.JO) is 15.2%.

The Cost of Equity of MTN Group Ltd (MTN.JO) is 18.05%.

The Cost of Debt of MTN Group Ltd (MTN.JO) is 11.35%.

	Range	Selected
Cost of equity	17.00% - 19.10%	18.05%
Tax rate	27.60% - 28.00%	27.80%
Cost of debt	11.30% - 11.40%	11.35%
WACC	14.4% - 15.9%	15.2%

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	0.83	0.86

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.00%	19.10%

Tax rate	27.60%	28.00%
Debt/Equity ratio	0.42	0.42
Cost of debt	11.30%	11.40%

After-tax WACC	14.4%	15.9%


Selected WACC	15.2%

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 (18.05%) = risk_free_rate (9.35%) + equity_risk_premium (10.00%) * adjusted_beta (0.83) + 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.