PORF.AS WACC - Weighted Average Cost of Capital

The WACC of Koninklijke Porceleyne Fles NV (PORF.AS) is 5.7%.

The Cost of Equity of Koninklijke Porceleyne Fles NV (PORF.AS) is 7.35%.

The Cost of Debt of Koninklijke Porceleyne Fles NV (PORF.AS) is 5.90%.

	Range	Selected
Cost of equity	4.50% - 10.20%	7.35%
Tax rate	19.00% - 23.00%	21.00%
Cost of debt	4.00% - 7.80%	5.90%
WACC	3.7% - 7.7%	5.7%

WACC

PORF.AS WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.37	1.08

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.50%	10.20%

Tax rate	19.00%	23.00%
Debt/Equity ratio	1.47	1.47
Cost of debt	4.00%	7.80%

After-tax WACC	3.7%	7.7%


Selected WACC	5.7%

PORF.AS'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 PORF.AS:

cost_of_equity (7.35%) = risk_free_rate (2.85%) + equity_risk_premium (5.60%) * adjusted_beta (0.37) + 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.