ROTS.TA WACC - Weighted Average Cost of Capital

The WACC of Rotshtein Realestate Ltd (ROTS.TA) is 7.5%.

The Cost of Equity of Rotshtein Realestate Ltd (ROTS.TA) is 8.80%.

The Cost of Debt of Rotshtein Realestate Ltd (ROTS.TA) is 7.85%.

	Range	Selected
Cost of equity	7.80% - 9.80%	8.80%
Tax rate	23.40% - 23.60%	23.50%
Cost of debt	5.60% - 10.10%	7.85%
WACC	6.1% - 8.8%	7.5%

WACC

ROTS.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.48	0.55

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.80%	9.80%

Tax rate	23.40%	23.60%
Debt/Equity ratio	0.91	0.91
Cost of debt	5.60%	10.10%

After-tax WACC	6.1%	8.8%


Selected WACC	7.5%

ROTS.TA'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 ROTS.TA:

cost_of_equity (8.80%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.48) + 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.