PHR.WA WACC - Weighted Average Cost of Capital

The WACC of Pharmena SA (PHR.WA) is 10.8%.

The Cost of Equity of Pharmena SA (PHR.WA) is 11.00%.

The Cost of Debt of Pharmena SA (PHR.WA) is 10.70%.

	Range	Selected
Cost of equity	9.30% - 12.70%	11.00%
Tax rate	7.90% - 10.60%	9.25%
Cost of debt	7.00% - 14.40%	10.70%
WACC	8.9% - 12.7%	10.8%

WACC

PHR.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.6	0.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.30%	12.70%

Tax rate	7.90%	10.60%
Debt/Equity ratio	0.19	0.19
Cost of debt	7.00%	14.40%

After-tax WACC	8.9%	12.7%


Selected WACC	10.8%

PHR.WA'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 PHR.WA:

cost_of_equity (11.00%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.6) + 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.