TRAK.L
Trakm8 Holdings PLC
Price:  
8.85 
GBP
Volume:  
1,143,261.00
United Kingdom | Communications Equipment
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TRAK.L WACC - Weighted Average Cost of Capital

The WACC of Trakm8 Holdings PLC (TRAK.L) is 5.5%.

The Cost of Equity of Trakm8 Holdings PLC (TRAK.L) is 7.10%.
The Cost of Debt of Trakm8 Holdings PLC (TRAK.L) is 7.05%.

Range Selected
Cost of equity 6.20% - 8.00% 7.10%
Tax rate 35.00% - 36.30% 35.65%
Cost of debt 7.00% - 7.10% 7.05%
WACC 5.2% - 5.9% 5.5%
WACC

TRAK.L WACC calculation

Category Low High
Long-term bond rate 4.0% 4.5%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.37 0.42
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.20% 8.00%
Tax rate 35.00% 36.30%
Debt/Equity ratio 1.58 1.58
Cost of debt 7.00% 7.10%
After-tax WACC 5.2% 5.9%
Selected WACC 5.5%

TRAK.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 TRAK.L:

cost_of_equity (7.10%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.37) + 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.