NFTA.TA WACC - Weighted Average Cost of Capital

The WACC of Naphtha Israel Petroleum Corp Ltd (NFTA.TA) is 8.7%.

The Cost of Equity of Naphtha Israel Petroleum Corp Ltd (NFTA.TA) is 11.55%.

The Cost of Debt of Naphtha Israel Petroleum Corp Ltd (NFTA.TA) is 4.70%.

	Range	Selected
Cost of equity	9.50% - 13.60%	11.55%
Tax rate	21.00% - 23.00%	22.00%
Cost of debt	4.00% - 5.40%	4.70%
WACC	7.2% - 10.1%	8.7%

WACC

NFTA.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.77	1.09

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.50%	13.60%

Tax rate	21.00%	23.00%
Debt/Equity ratio	0.58	0.58
Cost of debt	4.00%	5.40%

After-tax WACC	7.2%	10.1%


Selected WACC	8.7%

NFTA.TA'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 NFTA.TA:

cost_of_equity (11.55%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.77) + 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.