SNC.LS WACC - Weighted Average Cost of Capital
The WACC of Sonaecom SGPS SA (SNC.LS) is 5.9%.
| Range | Selected | |
| Cost of equity | 5.1% - 6.6% | 5.85% |
| Tax rate | 7.4% - 11.7% | 9.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.1% - 6.6% | 5.9% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 6.9% | 7.8% |
| Adjusted beta | 0.33 | 0.35 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.1% | 6.6% |
| Tax rate | 7.4% | 11.7% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.1% | 6.6% |
| Selected WACC | 5.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SNC.LS | Sonaecom SGPS SA | 0.01 | 0.54 | 0.54 |
| AAF.L | Airtel Africa PLC | 0.55 | 1.83 | 1.22 |
| ICEGR.OL | Ice Group ASA | 64.46 | 0.2 | 0 |
| NETM B.ST | Netmore Group AB | 0 | -0.73 | -0.73 |
| NTEL.OL | Nortel AS | 0.03 | -1.45 | -1.41 |
| OBEL.BR | Orange Belgium SA | 1.72 | 0 | 0 |
| VEON.AS | VEON Ltd | 2.28 | 0.23 | 0.08 |
| AKOM | Aerkomm Inc | 107.38 | 0.22 | 0 |
| SHEN | Shenandoah Telecommunications Co | 0.58 | 0.17 | 0.11 |
| SURG | Surgepays Inc | 0.08 | 0 | 0 |
| Low | High | |
| Unlevered beta | 0 | 0.03 |
| Relevered beta | 0 | 0.03 |
| Adjusted relevered beta | 0.33 | 0.35 |
SNC.LS'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 SNC.LS:
cost_of_equity (5.85%) = risk_free_rate (3.15%) + equity_risk_premium (7.35%) * adjusted_beta (0.33) + 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.