NSKOG.OL WACC - Weighted Average Cost of Capital
The WACC of Norske Skog ASA (NSKOG.OL) is 5.9%.
| Range | Selected | |
| Cost of equity | 7.8% - 10.7% | 9.25% |
| Tax rate | 14.6% - 17.6% | 16.1% |
| Cost of debt | 4.2% - 7.0% | 5.6% |
| WACC | 4.7% - 7.1% | 5.9% |
| Category | Low | High |
| Long-term bond rate | 3.3% | 3.8% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.88 | 1.05 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.8% | 10.7% |
| Tax rate | 14.6% | 17.6% |
| Debt/Equity ratio | 2.82 | 2.82 |
| Cost of debt | 4.2% | 7.0% |
| After-tax WACC | 4.7% | 7.1% |
| Selected WACC | 5.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| NSKOG.OL | Norske Skog ASA | 2.82 | 1.48 | 0.44 |
| ALTR.LS | Altri SGPS SA | 0.58 | 0.11 | 0.07 |
| ATC.WA | Arctic Paper SA | 0.31 | 0.47 | 0.37 |
| CPHN.SW | CPH Chemie und Papier Holding AG | 0.04 | 0.53 | 0.51 |
| ENC.MC | Ence Energia y Celulosa SA | 0.84 | 0.49 | 0.29 |
| EXAC.PA | Exacompta Clairefontaine SA | 2.38 | 0.37 | 0.12 |
| IBG.MC | Iberpapel Gestion SA | 0.34 | 0.31 | 0.24 |
| MCM.MC | Miquel Y Costas & Miquel SA | 0.09 | 0.24 | 0.22 |
| NPAPER.ST | Nordic Paper Holding AB | 0.32 | 0.26 | 0.21 |
| NVG.LS | Navigator Company SA | 0.31 | 0.55 | 0.44 |
| Low | High | |
| Unlevered beta | 0.24 | 0.32 |
| Relevered beta | 0.82 | 1.07 |
| Adjusted relevered beta | 0.88 | 1.05 |
NSKOG.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 NSKOG.OL:
cost_of_equity (9.25%) = risk_free_rate (3.55%) + equity_risk_premium (5.60%) * adjusted_beta (0.88) + 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.