The WACC of Societa Editoriale Il Fatto SpA (SEIF.MI) is 5.7%.
| Range | Selected | |
| Cost of equity | 5.50% - 8.40% | 6.95% |
| Tax rate | 33.40% - 47.40% | 40.40% |
| Cost of debt | 5.00% - 5.00% | 5.00% |
| WACC | 4.8% - 6.5% | 5.7% |
| Category | Low | High |
| Long-term bond rate | 3.7% | 4.2% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.16 | 0.35 |
| Additional risk adjustments | 0.5% | 1.0% |
| Cost of equity | 5.50% | 8.40% |
| Tax rate | 33.40% | 47.40% |
| Debt/Equity ratio | 0.48 | 0.48 |
| Cost of debt | 5.00% | 5.00% |
| After-tax WACC | 4.8% | 6.5% |
| Selected WACC | 5.7% | |
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 SEIF.MI:
cost_of_equity (6.95%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.16) + risk_adjustments (0.75%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.