The WACC of Riverfort Global Opportunities PLC (RGO.L) is 6.6%.
Range | Selected | |
Cost of equity | 7.3% - 11.2% | 9.25% |
Tax rate | 19.0% - 19.0% | 19% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 5.7% - 7.6% | 6.6% |
Category | Low | High |
Long-term bond rate | 4.0% | 4.5% |
Equity market risk premium | 6.0% | 7.0% |
Adjusted beta | 0.54 | 0.89 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 7.3% | 11.2% |
Tax rate | 19.0% | 19.0% |
Debt/Equity ratio | 1 | 1 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 5.7% | 7.6% |
Selected WACC | 6.6% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
RGO.L | Riverfort Global Opportunities PLC | 0.83 | -0.23 | -0.13 |
ADV.WA | Adiuvo Investments SA | 1.37 | -0.66 | -0.31 |
BLU.WA | Blumerang Investors SA | 0.81 | -1.49 | -0.9 |
CNLCAP.AT | CNL Capital EKES AIFM | 0.73 | 0.09 | 0.06 |
GEQ.MI | Gequity SpA | 1.66 | 0.18 | 0.08 |
LOUD.HE | Loudspring Plc | 0.5 | 1.06 | 0.76 |
MAFL.L | Mineral & Financial Investments Ltd | 0 | 0.34 | 0.34 |
MARKA.IS | Marka Yatirim Holding AS | 0 | 1.62 | 1.62 |
MWT.WA | M.W. Trade SA | 0.06 | 0.32 | 0.31 |
RHEAG.IS | Rhea Girisim Sermayesi Yatirim Ortakligi AS | 0.11 | 0.73 | 0.67 |
VTI.WA | Venture Inc SA | 0 | 1.16 | 1.15 |
Low | High | |
Unlevered beta | 0.08 | 0.34 |
Relevered beta | 0.31 | 0.84 |
Adjusted relevered beta | 0.54 | 0.89 |
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 RGO.L:
cost_of_equity (9.25%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.54) + 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.