PCGH.L WACC - Weighted Average Cost of Capital
The WACC of Polar Capital Global Healthcare Trust PLC (PCGH.L) is 11.2%.
| Range | Selected | |
| Cost of equity | 10.1% - 12.3% | 11.2% |
| Tax rate | 1.4% - 1.9% | 1.65% |
| Cost of debt | 4.0% - 4.6% | 4.3% |
| WACC | 10.1% - 12.3% | 11.2% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 1.02 | 1.05 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.1% | 12.3% |
| Tax rate | 1.4% | 1.9% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 4.0% | 4.6% |
| After-tax WACC | 10.1% | 12.3% |
| Selected WACC | 11.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PCGH.L | Polar Capital Global Healthcare Trust PLC | 0 | 0.66 | 0.66 |
| BGLF.L | Blackstone Loan Financing Ltd | 0.01 | 1.14 | 1.13 |
| HEFT.L | Henderson European Focus Trust PLC | 0.05 | 1.09 | 1.04 |
| HHI.L | Henderson High Income Trust PLC | 0.23 | 1.43 | 1.17 |
| HNE.L | Henderson Eurotrust PLC | 0.03 | 1.05 | 1.02 |
| IBT.L | International Biotechnology Trust PLC | 0.1 | 0.23 | 0.21 |
| IPU.L | Invesco Perpetual UK Smaller Companies Investment Trust PLC | 0.08 | 1.37 | 1.27 |
| JUSC.L | JPmorgan US Smaller Companies Investment Trust PLC | 0.11 | 1.56 | 1.41 |
| MNP.L | Martin Currie Global Portfolio Trust PLC | 0.06 | 0.73 | 0.7 |
| NAIT.L | North American Income Trust PLC | 0.1 | 1.13 | 1.03 |
| Low | High | |
| Unlevered beta | 1.03 | 1.08 |
| Relevered beta | 1.03 | 1.07 |
| Adjusted relevered beta | 1.02 | 1.05 |
PCGH.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 PCGH.L:
cost_of_equity (11.20%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (1.02) + 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.