TSL.L WACC - Weighted Average Cost of Capital
The WACC of Thinksmart Ltd (TSL.L) is 6.9%.
| Range | Selected | |
| Cost of equity | 6.1% - 7.8% | 6.95% |
| Tax rate | 0.1% - 4.8% | 2.45% |
| Cost of debt | 4.0% - 4.6% | 4.3% |
| WACC | 6.1% - 7.8% | 6.9% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.35 | 0.4 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.1% | 7.8% |
| Tax rate | 0.1% | 4.8% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 4.0% | 4.6% |
| After-tax WACC | 6.1% | 7.8% |
| Selected WACC | 6.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TSL.L | Thinksmart Ltd | 0 | 0.83 | 0.83 |
| CNF.MI | Conafi Prestito SpA | 0.2 | 0.25 | 0.21 |
| DDM.ST | DDM Holding AG | 7.31 | 0.06 | 0.01 |
| MBC.DE | MyBucks SA | 126.78 | 1.49 | 0.01 |
| MCL.L | Morses Club PLC | 48.49 | 2.08 | 0.04 |
| MFX.L | Manx Financial Group PLC | 1.84 | 1.36 | 0.48 |
| PCF.L | PCF Group PLC | 175.29 | 1.35 | 0.01 |
| QLIRO.ST | Qliro AB | 6.69 | 0.3 | 0.04 |
| RESURS.ST | Resurs Holding AB (publ) | 9.26 | 0.09 | 0.01 |
| RFX.L | Ramsdens Holdings PLC | 0.2 | 0.36 | 0.3 |
| Low | High | |
| Unlevered beta | 0.03 | 0.11 |
| Relevered beta | 0.03 | 0.1 |
| Adjusted relevered beta | 0.35 | 0.4 |
TSL.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 TSL.L:
cost_of_equity (6.95%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.35) + 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.