PAR.PA WACC - Weighted Average Cost of Capital

The WACC of Paris Realty Fund SA (PAR.PA) is 9.1%.

The Cost of Equity of Paris Realty Fund SA (PAR.PA) is 6.20%.

The Cost of Debt of Paris Realty Fund SA (PAR.PA) is 12.00%.

	Range	Selected
Cost of equity	5.30% - 7.10%	6.20%
Tax rate	3.30% - 6.60%	4.95%
Cost of debt	4.00% - 20.00%	12.00%
WACC	4.5% - 13.8%	9.1%

WACC

PAR.PA WACC calculation

Category	Low	High

Long-term bond rate	3.0%	3.5%
Equity market risk premium	5.8%	6.8%
Adjusted beta	0.39	0.45

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.30%	7.10%

Tax rate	3.30%	6.60%
Debt/Equity ratio	1.39	1.39
Cost of debt	4.00%	20.00%

After-tax WACC	4.5%	13.8%


Selected WACC	9.1%

PAR.PA'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 PAR.PA:

cost_of_equity (6.20%) = risk_free_rate (3.25%) + equity_risk_premium (6.30%) * 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.