TOHN.SW WACC - Weighted Average Cost of Capital

The WACC of Tornos Holding AG (TOHN.SW) is 6.2%.

The Cost of Equity of Tornos Holding AG (TOHN.SW) is 5.50%.

The Cost of Debt of Tornos Holding AG (TOHN.SW) is 19.45%.

	Range	Selected
Cost of equity	4.60% - 6.40%	5.50%
Tax rate	2.10% - 3.50%	2.80%
Cost of debt	4.00% - 34.90%	19.45%
WACC	4.6% - 7.7%	6.2%

WACC

TOHN.SW WACC calculation

Category	Low	High

Long-term bond rate	1.0%	1.5%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.72	0.73

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.60%	6.40%

Tax rate	2.10%	3.50%
Debt/Equity ratio	0.05	0.05
Cost of debt	4.00%	34.90%

After-tax WACC	4.6%	7.7%


Selected WACC	6.2%

TOHN.SW'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 TOHN.SW:

cost_of_equity (5.50%) = risk_free_rate (1.25%) + equity_risk_premium (5.60%) * adjusted_beta (0.72) + 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.