POS.VI WACC - Weighted Average Cost of Capital

The WACC of Porr AG (POS.VI) is 8.5%.

The Cost of Equity of Porr AG (POS.VI) is 7.70%.

The Cost of Debt of Porr AG (POS.VI) is 13.50%.

	Range	Selected
Cost of equity	6.20% - 9.20%	7.70%
Tax rate	24.90% - 25.90%	25.40%
Cost of debt	11.30% - 15.70%	13.50%
WACC	6.9% - 10.0%	8.5%

WACC

POS.VI WACC calculation

Category	Low	High

Long-term bond rate	2.8%	3.3%
Equity market risk premium	5.7%	6.7%
Adjusted beta	0.59	0.81

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.20%	9.20%

Tax rate	24.90%	25.90%
Debt/Equity ratio	0.51	0.51
Cost of debt	11.30%	15.70%

After-tax WACC	6.9%	10.0%


Selected WACC	8.5%

POS.VI'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 POS.VI:

cost_of_equity (7.70%) = risk_free_rate (3.05%) + equity_risk_premium (6.20%) * adjusted_beta (0.59) + 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.