PUMU.HE WACC - Weighted Average Cost of Capital

The WACC of PunaMusta Media Oyj (PUMU.HE) is 5.3%.

The Cost of Equity of PunaMusta Media Oyj (PUMU.HE) is 6.70%.

The Cost of Debt of PunaMusta Media Oyj (PUMU.HE) is 5.50%.

	Range	Selected
Cost of equity	5.50% - 7.90%	6.70%
Tax rate	10.70% - 12.70%	11.70%
Cost of debt	4.00% - 7.00%	5.50%
WACC	4.0% - 6.5%	5.3%

WACC

PUMU.HE WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.7%	6.7%
Adjusted beta	0.49	0.63

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.50%	7.90%

Tax rate	10.70%	12.70%
Debt/Equity ratio	3.18	3.18
Cost of debt	4.00%	7.00%

After-tax WACC	4.0%	6.5%


Selected WACC	5.3%

PUMU.HE'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 PUMU.HE:

cost_of_equity (6.70%) = risk_free_rate (2.95%) + equity_risk_premium (6.20%) * adjusted_beta (0.49) + 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.