OXIG.L WACC - Weighted Average Cost of Capital

The WACC of Oxford Instruments PLC (OXIG.L) is 11.4%.

The Cost of Equity of Oxford Instruments PLC (OXIG.L) is 11.70%.

The Cost of Debt of Oxford Instruments PLC (OXIG.L) is 4.30%.

	Range	Selected
Cost of equity	10.50% - 12.90%	11.70%
Tax rate	20.10% - 23.70%	21.90%
Cost of debt	4.00% - 4.60%	4.30%
WACC	10.3% - 12.6%	11.4%

WACC

OXIG.L WACC calculation

Category	Low	High

Long-term bond rate	4.0%	4.5%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.09	1.13

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.50%	12.90%

Tax rate	20.10%	23.70%
Debt/Equity ratio	0.04	0.04
Cost of debt	4.00%	4.60%

After-tax WACC	10.3%	12.6%


Selected WACC	11.4%

OXIG.L'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 OXIG.L:

cost_of_equity (11.70%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (1.09) + 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.