POLI.TA WACC - Weighted Average Cost of Capital

The WACC of Bank Hapoalim BM (POLI.TA) is 7.7%.

The Cost of Equity of Bank Hapoalim BM (POLI.TA) is 10.15%.

The Cost of Debt of Bank Hapoalim BM (POLI.TA) is 5.00%.

	Range	Selected
Cost of equity	9.10% - 11.20%	10.15%
Tax rate	35.30% - 36.20%	35.75%
Cost of debt	5.00% - 5.00%	5.00%
WACC	7.1% - 8.4%	7.7%

WACC

POLI.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.69	0.75

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.10%	11.20%

Tax rate	35.30%	36.20%
Debt/Equity ratio	0.53	0.53
Cost of debt	5.00%	5.00%

After-tax WACC	7.1%	8.4%


Selected WACC	7.7%

POLI.TA'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 POLI.TA:

cost_of_equity (10.15%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.69) + 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.