SOLTEQ.HE WACC - Weighted Average Cost of Capital

The WACC of Solteq Oyj (SOLTEQ.HE) is 8.1%.

The Cost of Equity of Solteq Oyj (SOLTEQ.HE) is 11.60%.

The Cost of Debt of Solteq Oyj (SOLTEQ.HE) is 8.80%.

	Range	Selected
Cost of equity	9.30% - 13.90%	11.60%
Tax rate	20.20% - 24.20%	22.20%
Cost of debt	6.40% - 11.20%	8.80%
WACC	6.3% - 10.0%	8.1%

WACC

SOLTEQ.HE WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	5.7%	6.7%
Adjusted beta	1.15	1.53

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.30%	13.90%

Tax rate	20.20%	24.20%
Debt/Equity ratio	2.6	2.6
Cost of debt	6.40%	11.20%

After-tax WACC	6.3%	10.0%


Selected WACC	8.1%

SOLTEQ.HE'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 SOLTEQ.HE:

cost_of_equity (11.60%) = risk_free_rate (2.95%) + equity_risk_premium (6.20%) * adjusted_beta (1.15) + 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.