The WACC of Robeco Sustainable Global Stars Equities Fund NV (ROBA.AS) is 8.2%.
| Range | Selected | |
| Cost of equity | 11.30% - 14.10% | 12.70% |
| Tax rate | 25.00% - 25.00% | 25.00% |
| Cost of debt | 5.00% - 5.00% | 5.00% |
| WACC | 7.5% - 8.9% | 8.2% |
| Category | Low | High |
| Long-term bond rate | 2.3% | 2.8% |
| Equity market risk premium | 6.6% | 7.6% |
| Adjusted beta | 1.36 | 1.41 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 11.30% | 14.10% |
| Tax rate | 25.00% | 25.00% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.00% | 5.00% |
| After-tax WACC | 7.5% | 8.9% |
| Selected WACC | 8.2% | |
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 ROBA.AS:
cost_of_equity (12.70%) = risk_free_rate (2.55%) + equity_risk_premium (7.10%) * adjusted_beta (1.36) + 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.