SHE.MI WACC - Weighted Average Cost of Capital

The WACC of Shedir Pharma Srl Unipersonale (SHE.MI) is 9.8%.

The Cost of Equity of Shedir Pharma Srl Unipersonale (SHE.MI) is 10.85%.

The Cost of Debt of Shedir Pharma Srl Unipersonale (SHE.MI) is 4.25%.

	Range	Selected
Cost of equity	7.30% - 14.40%	10.85%
Tax rate	28.70% - 29.80%	29.25%
Cost of debt	4.00% - 4.50%	4.25%
WACC	6.7% - 12.9%	9.8%

WACC

SHE.MI WACC calculation

Category	Low	High

Long-term bond rate	3.7%	4.2%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.44	1.04

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.30%	14.40%

Tax rate	28.70%	29.80%
Debt/Equity ratio	0.15	0.15
Cost of debt	4.00%	4.50%

After-tax WACC	6.7%	12.9%


Selected WACC	9.8%

SHE.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 SHE.MI:

cost_of_equity (10.85%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.44) + 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.