SWG.WA WACC - Weighted Average Cost of Capital

The WACC of Seco/Warwick SA (SWG.WA) is 9.3%.

The Cost of Equity of Seco/Warwick SA (SWG.WA) is 10.75%.

The Cost of Debt of Seco/Warwick SA (SWG.WA) is 6.05%.

	Range	Selected
Cost of equity	9.00% - 12.50%	10.75%
Tax rate	15.00% - 18.90%	16.95%
Cost of debt	4.90% - 7.20%	6.05%
WACC	7.8% - 10.9%	9.3%

WACC

SWG.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.56	0.82

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.00%	12.50%

Tax rate	15.00%	18.90%
Debt/Equity ratio	0.33	0.33
Cost of debt	4.90%	7.20%

After-tax WACC	7.8%	10.9%


Selected WACC	9.3%

SWG.WA'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 SWG.WA:

cost_of_equity (10.75%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.56) + 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.