STG.TA WACC - Weighted Average Cost of Capital

The WACC of STG International Ltd (STG.TA) is 10.3%.

The Cost of Equity of STG International Ltd (STG.TA) is 10.55%.

The Cost of Debt of STG International Ltd (STG.TA) is 5.00%.

	Range	Selected
Cost of equity	9.30% - 11.80%	10.55%
Tax rate	23.90% - 24.00%	23.95%
Cost of debt	5.00% - 5.00%	5.00%
WACC	9.1% - 11.5%	10.3%

WACC

STG.TA WACC calculation

Category	Low	High

Long-term bond rate	4.8%	5.3%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.73	0.84

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.30%	11.80%

Tax rate	23.90%	24.00%
Debt/Equity ratio	0.04	0.04
Cost of debt	5.00%	5.00%

After-tax WACC	9.1%	11.5%


Selected WACC	10.3%

STG.TA'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 STG.TA:

cost_of_equity (10.55%) = risk_free_rate (5.05%) + equity_risk_premium (6.60%) * adjusted_beta (0.73) + 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.