SPDI.L
Secure Property Development & Investment PLC
Price:  
3.50 
GBP
Volume:  
210,000.00
Cyprus | N/A
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SPDI.L WACC - Weighted Average Cost of Capital

The WACC of Secure Property Development & Investment PLC (SPDI.L) is 7.1%.

The Cost of Equity of Secure Property Development & Investment PLC (SPDI.L) is 7.50%.
The Cost of Debt of Secure Property Development & Investment PLC (SPDI.L) is 5.00%.

Range Selected
Cost of equity 6.00% - 9.00% 7.50%
Tax rate 1.50% - 4.40% 2.95%
Cost of debt 5.00% - 5.00% 5.00%
WACC 5.9% - 8.3% 7.1%
WACC

SPDI.L WACC calculation

Category Low High
Long-term bond rate 4.0% 4.5%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.34 0.58
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.00% 9.00%
Tax rate 1.50% 4.40%
Debt/Equity ratio 0.2 0.2
Cost of debt 5.00% 5.00%
After-tax WACC 5.9% 8.3%
Selected WACC 7.1%

SPDI.L'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 SPDI.L:

cost_of_equity (7.50%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.34) + 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.