The WACC of Stratec SE (SBS.DE) is 7.8%.
Range | Selected | |
Cost of equity | 7.7% - 11.5% | 9.6% |
Tax rate | 21.0% - 26.0% | 23.5% |
Cost of debt | 4.0% - 4.5% | 4.25% |
WACC | 6.4% - 9.2% | 7.8% |
Category | Low | High |
Long-term bond rate | 2.8% | 3.3% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 0.96 | 1.26 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 7.7% | 11.5% |
Tax rate | 21.0% | 26.0% |
Debt/Equity ratio | 0.4 | 0.4 |
Cost of debt | 4.0% | 4.5% |
After-tax WACC | 6.4% | 9.2% |
Selected WACC | 7.8% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
SBS.DE | Stratec SE | 0.4 | 1.55 | 1.19 |
CEVI.ST | CellaVision AB | 0.01 | 0.64 | 0.64 |
EKF.L | EKF Diagnostics Holdings PLC | 0.03 | 0.28 | 0.27 |
ELN.MI | El En SpA | 0.05 | 1.11 | 1.07 |
EUZ.DE | Eckert & Ziegler Strahlen und Medizintechnik AG | 0.04 | 1.31 | 1.27 |
GVS.MI | GVS SpA | 0.31 | 0.63 | 0.51 |
IBAB.BR | Ion Beam Applications SA | 0.13 | 0.85 | 0.78 |
MEDI.OL | Medistim ASA | 0.01 | 0.28 | 0.28 |
MOVE.SW | Medacta Group SA | 0.08 | 1.14 | 1.07 |
REG1V.HE | Revenio Group Oyj | 0.03 | 1.27 | 1.25 |
Low | High | |
Unlevered beta | 0.72 | 1.07 |
Relevered beta | 0.94 | 1.39 |
Adjusted relevered beta | 0.96 | 1.26 |
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 SBS.DE:
cost_of_equity (9.60%) = risk_free_rate (3.05%) + equity_risk_premium (5.60%) * adjusted_beta (0.96) + 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.