The WACC of Q linea AB (QLINEA.ST) is 38.6%.
| Range | Selected | |
| Cost of equity | 5.20% - 6.70% | 5.95% |
| Tax rate | 20.60% - 20.90% | 20.75% |
| Cost of debt | 7.00% - 176.60% | 91.80% |
| WACC | 5.4% - 71.7% | 38.6% |
| Category | Low | High |
| Long-term bond rate | 2.5% | 3.0% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.33 | 0.36 |
| Additional risk adjustments | 1.0% | 1.5% |
| Cost of equity | 5.20% | 6.70% |
| Tax rate | 20.60% | 20.90% |
| Debt/Equity ratio | 0.96 | 0.96 |
| Cost of debt | 7.00% | 176.60% |
| After-tax WACC | 5.4% | 71.7% |
| Selected WACC | 38.6% | |
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 QLINEA.ST:
cost_of_equity (5.95%) = risk_free_rate (2.75%) + equity_risk_premium (5.60%) * adjusted_beta (0.33) + risk_adjustments (1.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.