TRANS.ST WACC - Weighted Average Cost of Capital

The WACC of Transtema Group AB (TRANS.ST) is 8.6%.

The Cost of Equity of Transtema Group AB (TRANS.ST) is 10.45%.

The Cost of Debt of Transtema Group AB (TRANS.ST) is 9.25%.

	Range	Selected
Cost of equity	8.20% - 12.70%	10.45%
Tax rate	13.00% - 18.20%	15.60%
Cost of debt	7.00% - 11.50%	9.25%
WACC	6.7% - 10.4%	8.6%

WACC

TRANS.ST WACC calculation

Category	Low	High

Long-term bond rate	2.5%	3.0%
Equity market risk premium	5.1%	6.1%
Adjusted beta	1.12	1.51

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.20%	12.70%

Tax rate	13.00%	18.20%
Debt/Equity ratio	2.27	2.27
Cost of debt	7.00%	11.50%

After-tax WACC	6.7%	10.4%


Selected WACC	8.6%

TRANS.ST'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 TRANS.ST:

cost_of_equity (10.45%) = risk_free_rate (2.75%) + equity_risk_premium (5.60%) * adjusted_beta (1.12) + 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.