SES.MI
Sesa SpA
Price:  
75.90 
EUR
Volume:  
14,676.00
Italy | Electronic Equipment, Instruments & Components
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SES.MI WACC - Weighted Average Cost of Capital

The WACC of Sesa SpA (SES.MI) is 8.9%.

The Cost of Equity of Sesa SpA (SES.MI) is 10.80%.
The Cost of Debt of Sesa SpA (SES.MI) is 4.75%.

Range Selected
Cost of equity 8.90% - 12.70% 10.80%
Tax rate 29.70% - 29.80% 29.75%
Cost of debt 4.40% - 5.10% 4.75%
WACC 7.4% - 10.3% 8.9%
WACC

SES.MI WACC calculation

Category Low High
Long-term bond rate 3.7% 4.2%
Equity market risk premium 8.3% 9.3%
Adjusted beta 0.63 0.86
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.90% 12.70%
Tax rate 29.70% 29.80%
Debt/Equity ratio 0.35 0.35
Cost of debt 4.40% 5.10%
After-tax WACC 7.4% 10.3%
Selected WACC 8.9%

SES.MI'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 SES.MI:

cost_of_equity (10.80%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.63) + 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.