SBANK.OL
Sbanken ASA
Price:  
104.8 
NOK
Volume:  
228,825
Norway | Banks

SBANK.OL WACC - Weighted Average Cost of Capital

The WACC of Sbanken ASA (SBANK.OL) is 5.6%.

The Cost of Equity of Sbanken ASA (SBANK.OL) is 10.25%.
The Cost of Debt of Sbanken ASA (SBANK.OL) is 5%.

RangeSelected
Cost of equity7.4% - 13.1%10.25%
Tax rate22.5% - 23.0%22.75%
Cost of debt5.0% - 5.0%5%
WACC4.9% - 6.4%5.6%
WACC

SBANK.OL WACC calculation

CategoryLowHigh
Long-term bond rate3.1%3.6%
Equity market risk premium4.7%5.7%
Adjusted beta0.921.57
Additional risk adjustments0.0%0.5%
Cost of equity7.4%13.1%
Tax rate22.5%23.0%
Debt/Equity ratio
2.632.63
Cost of debt5.0%5.0%
After-tax WACC4.9%6.4%
Selected WACC5.6%

SBANK.OL'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 SBANK.OL:

cost_of_equity (10.25%) = risk_free_rate (3.35%) + equity_risk_premium (5.20%) * adjusted_beta (0.92) + 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.