RBN.L WACC - Weighted Average Cost of Capital
The WACC of Robinson PLC (RBN.L) is 8.7%.
| Range | Selected | |
| Cost of equity | 9.3% - 12.1% | 10.7% |
| Tax rate | 19.6% - 21.5% | 20.55% |
| Cost of debt | 4.0% - 6.2% | 5.1% |
| WACC | 7.5% - 9.9% | 8.7% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.89 | 1.01 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.3% | 12.1% |
| Tax rate | 19.6% | 21.5% |
| Debt/Equity ratio | 0.44 | 0.44 |
| Cost of debt | 4.0% | 6.2% |
| After-tax WACC | 7.5% | 9.9% |
| Selected WACC | 8.7% | |
| Low | High | |
| Unlevered beta | 0.62 | 0.75 |
| Relevered beta | 0.84 | 1.01 |
| Adjusted relevered beta | 0.89 | 1.01 |
RBN.L'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 RBN.L:
cost_of_equity (10.70%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.89) + 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.