SBMO.AS WACC - Weighted Average Cost of Capital

The WACC of SBM Offshore NV (SBMO.AS) is 6.2%.

The Cost of Equity of SBM Offshore NV (SBMO.AS) is 10.80%.

The Cost of Debt of SBM Offshore NV (SBMO.AS) is 4.60%.

	Range	Selected
Cost of equity	9.50% - 12.10%	10.80%
Tax rate	12.00% - 14.10%	13.05%
Cost of debt	4.40% - 4.80%	4.60%
WACC	5.7% - 6.7%	6.2%

WACC

SBMO.AS WACC calculation

Category	Low	High

Long-term bond rate	2.6%	3.1%
Equity market risk premium	5.1%	6.1%
Adjusted beta	1.35	1.41

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.50%	12.10%

Tax rate	12.00%	14.10%
Debt/Equity ratio	2.1	2.1
Cost of debt	4.40%	4.80%

After-tax WACC	5.7%	6.7%


Selected WACC	6.2%

SBMO.AS'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 SBMO.AS:

cost_of_equity (10.80%) = risk_free_rate (2.85%) + equity_risk_premium (5.60%) * adjusted_beta (1.35) + 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.