The WACC of Oasmia Pharmaceutical AB (OASM.ST) is 7.3%.
Range | Selected | |
Cost of equity | 5.2% - 9.5% | 7.35% |
Tax rate | 0.0% - 7.8% | 3.9% |
Cost of debt | 7.0% - 7.0% | 7% |
WACC | 5.3% - 9.3% | 7.3% |
Category | Low | High |
Long-term bond rate | 0.6% | 1.1% |
Equity market risk premium | 5.2% | 6.2% |
Adjusted beta | 0.49 | 0.94 |
Additional risk adjustments | 2.0% | 2.5% |
Cost of equity | 5.2% | 9.5% |
Tax rate | 0.0% | 7.8% |
Debt/Equity ratio | 0.07 | 0.07 |
Cost of debt | 7.0% | 7.0% |
After-tax WACC | 5.3% | 9.3% |
Selected WACC | 7.3% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
OASM.ST | Oasmia Pharmaceutical AB | 0.07 | 0.47 | 0.44 |
BIOPOR.CO | Bioporto A/S | 0.02 | 0.4 | 0.39 |
BML.WA | Biomed Lublin Wytwornia Surowic i Szczepionek SA | 0.04 | 0.41 | 0.4 |
BONEH.HE | BBS-Bioactive Bone Substitutes Oyj | 3.15 | 1.73 | 0.49 |
BOTHE.BR | Bone Therapeutics SA | 8.55 | 0.32 | 0.04 |
COX.PA | Nicox SA | 0.97 | 0.98 | 0.55 |
ERYP.PA | Erytech Pharma SA | 1.01 | 2.91 | 1.6 |
HBC.OL | Hofseth Biocare ASA | 0.23 | 0.67 | 0.57 |
PA8.DE | Paion AG | 11.41 | 3.58 | 0.35 |
VICO.ST | Vicore Pharma Holding AB | 0.88 | 0.56 | 0.33 |
Low | High | |
Unlevered beta | 0.4 | 0.46 |
Relevered beta | 0.24 | 0.91 |
Adjusted relevered beta | 0.49 | 0.94 |
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 OASM.ST:
cost_of_equity (7.35%) = risk_free_rate (0.85%) + equity_risk_premium (5.70%) * adjusted_beta (0.49) + risk_adjustments (2.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.