SYS.L
SysGroup PLC
Price:  
20.50 
GBP
Volume:  
36,040.00
United Kingdom | IT Services
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SYS.L WACC - Weighted Average Cost of Capital

The WACC of SysGroup PLC (SYS.L) is 7.7%.

The Cost of Equity of SysGroup PLC (SYS.L) is 7.85%.
The Cost of Debt of SysGroup PLC (SYS.L) is 9.95%.

Range Selected
Cost of equity 6.70% - 9.00% 7.85%
Tax rate 22.60% - 28.10% 25.35%
Cost of debt 7.00% - 12.90% 9.95%
WACC 6.4% - 9.1% 7.7%
WACC

SYS.L WACC calculation

Category Low High
Long-term bond rate 4.0% 4.5%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.46 0.57
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.70% 9.00%
Tax rate 22.60% 28.10%
Debt/Equity ratio 0.31 0.31
Cost of debt 7.00% 12.90%
After-tax WACC 6.4% 9.1%
Selected WACC 7.7%

SYS.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 SYS.L:

cost_of_equity (7.85%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.46) + 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.