NOD.OL WACC - Weighted Average Cost of Capital

The WACC of Nordic Semiconductor ASA (NOD.OL) is 8.6%.

The Cost of Equity of Nordic Semiconductor ASA (NOD.OL) is 8.90%.

The Cost of Debt of Nordic Semiconductor ASA (NOD.OL) is 5.50%.

	Range	Selected
Cost of equity	7.00% - 10.80%	8.90%
Tax rate	15.40% - 21.80%	18.60%
Cost of debt	4.00% - 7.00%	5.50%
WACC	6.8% - 10.5%	8.6%

WACC

NOD.OL WACC calculation

Category	Low	High

Long-term bond rate	3.3%	3.8%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.72	1.06

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.00%	10.80%

Tax rate	15.40%	21.80%
Debt/Equity ratio	0.07	0.07
Cost of debt	4.00%	7.00%

After-tax WACC	6.8%	10.5%


Selected WACC	8.6%

NOD.OL'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 NOD.OL:

cost_of_equity (8.90%) = risk_free_rate (3.55%) + equity_risk_premium (5.60%) * adjusted_beta (0.72) + 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.