SOP.PA
Sopra Steria Group SA
Price:  
189.40 
EUR
Volume:  
28,498.00
France | IT Services
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SOP.PA WACC - Weighted Average Cost of Capital

The WACC of Sopra Steria Group SA (SOP.PA) is 8.2%.

The Cost of Equity of Sopra Steria Group SA (SOP.PA) is 9.85%.
The Cost of Debt of Sopra Steria Group SA (SOP.PA) is 4.25%.

Range Selected
Cost of equity 8.70% - 11.00% 9.85%
Tax rate 28.10% - 31.60% 29.85%
Cost of debt 4.00% - 4.50% 4.25%
WACC 7.3% - 9.1% 8.2%
WACC

SOP.PA WACC calculation

Category Low High
Long-term bond rate 3.0% 3.5%
Equity market risk premium 5.8% 6.8%
Adjusted beta 0.98 1.03
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.70% 11.00%
Tax rate 28.10% 31.60%
Debt/Equity ratio 0.32 0.32
Cost of debt 4.00% 4.50%
After-tax WACC 7.3% 9.1%
Selected WACC 8.2%

SOP.PA'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 SOP.PA:

cost_of_equity (9.85%) = risk_free_rate (3.25%) + equity_risk_premium (6.30%) * adjusted_beta (0.98) + 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.