NEX.L
National Express Group PLC
Price:  
77.40 
GBP
Volume:  
1,311,210.00
United Kingdom | Road & Rail
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NEX.L WACC - Weighted Average Cost of Capital

The WACC of National Express Group PLC (NEX.L) is 7.4%.

The Cost of Equity of National Express Group PLC (NEX.L) is 16.10%.
The Cost of Debt of National Express Group PLC (NEX.L) is 4.80%.

Range Selected
Cost of equity 11.50% - 20.70% 16.10%
Tax rate 7.60% - 11.90% 9.75%
Cost of debt 4.00% - 5.60% 4.80%
WACC 5.8% - 9.1% 7.4%
WACC

NEX.L WACC calculation

Category Low High
Long-term bond rate 4.4% 4.9%
Equity market risk premium 6.4% 7.4%
Adjusted beta 1.11 2.05
Additional risk adjustments 0.0% 0.5%
Cost of equity 11.50% 20.70%
Tax rate 7.60% 11.90%
Debt/Equity ratio 2.76 2.76
Cost of debt 4.00% 5.60%
After-tax WACC 5.8% 9.1%
Selected WACC 7.4%

NEX.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 NEX.L:

cost_of_equity (16.10%) = risk_free_rate (4.65%) + equity_risk_premium (6.90%) * adjusted_beta (1.11) + 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.