PRM.MI WACC - Weighted Average Cost of Capital
The WACC of PRISMI SpA (PRM.MI) is 6.1%.
| Range | Selected | |
| Cost of equity | 6.3% - 13.1% | 9.7% |
| Tax rate | 4.0% - 7.5% | 5.75% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.2% - 7.0% | 6.1% |
| Category | Low | High |
| Long-term bond rate | 3.7% | 4.2% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.32 | 0.91 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.3% | 13.1% |
| Tax rate | 4.0% | 7.5% |
| Debt/Equity ratio | 2.6 | 2.6 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.2% | 7.0% |
| Selected WACC | 6.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PRM.MI | PRISMI SpA | 2.6 | -0.05 | -0.02 |
| ALNXT.PA | Nextedia SA | 0.39 | 0.57 | 0.41 |
| BCM.WA | Betacom SA | 0.08 | 0.15 | 0.14 |
| BINERO.ST | Binero Group AB (publ) | 0.09 | -0.06 | -0.05 |
| BKS.L | Beeks Financial Cloud Group PLC | 0.02 | 1.68 | 1.64 |
| FPG.PA | Union Technologies Informatique Group SA | 1.81 | -0.27 | -0.1 |
| FRAM B.ST | Fram Skandinavien AB (publ) | 0 | 0.56 | 0.56 |
| NC5A.DE | NorCom Information Technology AG | 0.2 | -0.3 | -0.25 |
| RED.LS | Reditus Sociedade Gestora de Participacoes Sociais SA | 105.44 | 0.33 | 0 |
| TIE.AS | TIE Kinetix NV | 0.01 | 1.07 | 1.06 |
| Low | High | |
| Unlevered beta | 0 | 0.25 |
| Relevered beta | -0.01 | 0.87 |
| Adjusted relevered beta | 0.32 | 0.91 |
PRM.MI'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 PRM.MI:
cost_of_equity (9.70%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.32) + 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.