TPT.L
Topps Tiles PLC
Price:  
37.1 
GBP
Volume:  
1,334,789
United Kingdom | Specialty Retail

TPT.L WACC - Weighted Average Cost of Capital

The WACC of Topps Tiles PLC (TPT.L) is 7.6%.

The Cost of Equity of Topps Tiles PLC (TPT.L) is 10.8%.
The Cost of Debt of Topps Tiles PLC (TPT.L) is 6.7%.

RangeSelected
Cost of equity8.9% - 12.7%10.8%
Tax rate20.0% - 22.0%21%
Cost of debt4.2% - 9.2%6.7%
WACC5.7% - 9.5%7.6%
WACC

TPT.L WACC calculation

CategoryLowHigh
Long-term bond rate4.0%4.5%
Equity market risk premium6.0%7.0%
Adjusted beta0.821.11
Additional risk adjustments0.0%0.5%
Cost of equity8.9%12.7%
Tax rate20.0%22.0%
Debt/Equity ratio
1.381.38
Cost of debt4.2%9.2%
After-tax WACC5.7%9.5%
Selected WACC7.6%

TPT.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 TPT.L:

cost_of_equity (10.80%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.82) + 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.