STAR.L
Starcom PLC
Price:  
7.62 
GBP
Volume:  
78,786.00
Jersey | Software
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

STAR.L WACC - Weighted Average Cost of Capital

The WACC of Starcom PLC (STAR.L) is 7.0%.

The Cost of Equity of Starcom PLC (STAR.L) is 7.35%.
The Cost of Debt of Starcom PLC (STAR.L) is 8.35%.

Range Selected
Cost of equity 6.00% - 8.70% 7.35%
Tax rate 19.00% - 19.00% 19.00%
Cost of debt 7.60% - 9.10% 8.35%
WACC 6.1% - 7.9% 7.0%
WACC

STAR.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 0.53
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.00% 8.70%
Tax rate 19.00% 19.00%
Debt/Equity ratio 1.41 1.41
Cost of debt 7.60% 9.10%
After-tax WACC 6.1% 7.9%
Selected WACC 7.0%

STAR.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 STAR.L:

cost_of_equity (7.35%) = 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.