TIP.MI WACC - Weighted Average Cost of Capital

The WACC of Tamburi Investment Partners SpA (TIP.MI) is 9.4%.

The Cost of Equity of Tamburi Investment Partners SpA (TIP.MI) is 10.90%.

The Cost of Debt of Tamburi Investment Partners SpA (TIP.MI) is 5.50%.

	Range	Selected
Cost of equity	9.10% - 12.70%	10.90%
Tax rate	0.90% - 24.10%	12.50%
Cost of debt	4.00% - 7.00%	5.50%
WACC	7.9% - 10.9%	9.4%

WACC

TIP.MI WACC calculation

Category	Low	High

Long-term bond rate	3.7%	4.2%
Equity market risk premium	8.3%	9.3%
Adjusted beta	0.66	0.86

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.10%	12.70%

Tax rate	0.90%	24.10%
Debt/Equity ratio	0.31	0.31
Cost of debt	4.00%	7.00%

After-tax WACC	7.9%	10.9%


Selected WACC	9.4%

TIP.MI'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 TIP.MI:

cost_of_equity (10.90%) = risk_free_rate (3.95%) + equity_risk_premium (8.80%) * adjusted_beta (0.66) + 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.