The WACC of Crescent NV (OPTI.BR) is 7.1%.
Range | Selected | |
Cost of equity | 5.2% - 7.8% | 6.5% |
Tax rate | 1.0% - 1.8% | 1.4% |
Cost of debt | 7.0% - 11.9% | 9.45% |
WACC | 5.6% - 8.6% | 7.1% |
Category | Low | High |
Long-term bond rate | 2.9% | 3.4% |
Equity market risk premium | 6.0% | 7.0% |
Adjusted beta | 0.39 | 0.56 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 5.2% | 7.8% |
Tax rate | 1.0% | 1.8% |
Debt/Equity ratio | 0.28 | 0.28 |
Cost of debt | 7.0% | 11.9% |
After-tax WACC | 5.6% | 8.6% |
Selected WACC | 7.1% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
OPTI.BR | Crescent NV | 0.28 | 0.57 | 0.44 |
ALMIC.PA | Micropole SA | 0.34 | 0.02 | 0.02 |
ALMUN.PA | Munic SA | 1.09 | 0.3 | 0.15 |
ATEME.PA | Ateme SA | 0.66 | 0.14 | 0.09 |
ENET.L | Ethernity Networks Ltd | 0.79 | 0.06 | 0.03 |
FTC.L | Filtronic PLC | 0.01 | 1.52 | 1.51 |
MWE.L | MTI Wireless Edge Ltd | 0.02 | 0.88 | 0.86 |
RTX.CO | Rtx A/S | 0.08 | 0.07 | 0.06 |
SAF1R.RG | SAF Tehnika AS | 0.1 | -0.01 | -0.01 |
SRT.L | SRT Marine Systems PLC | 0.08 | 0.89 | 0.83 |
Low | High | |
Unlevered beta | 0.08 | 0.26 |
Relevered beta | 0.09 | 0.34 |
Adjusted relevered beta | 0.39 | 0.56 |
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 OPTI.BR:
cost_of_equity (6.50%) = risk_free_rate (3.15%) + equity_risk_premium (6.50%) * adjusted_beta (0.39) + 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.