SOLTEQ.HE WACC - Weighted Average Cost of Capital

The WACC of Solteq Oyj (SOLTEQ.HE) is 8.6%.

The Cost of Equity of Solteq Oyj (SOLTEQ.HE) is 9.80%.

The Cost of Debt of Solteq Oyj (SOLTEQ.HE) is 10.45%.

	Range	Selected
Cost of equity	7.30% - 12.30%	9.80%
Tax rate	20.20% - 24.20%	22.20%
Cost of debt	6.40% - 14.50%	10.45%
WACC	5.8% - 11.5%	8.6%

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	0.81	1.29

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.30%	12.30%

Tax rate	20.20%	24.20%
Debt/Equity ratio	2.01	2.01
Cost of debt	6.40%	14.50%

After-tax WACC	5.8%	11.5%


Selected WACC	8.6%

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 (9.80%) = risk_free_rate (2.95%) + equity_risk_premium (6.20%) * adjusted_beta (0.81) + 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.