UBI.PA WACC - Weighted Average Cost of Capital
The WACC of Ubisoft Entertainment SA (UBI.PA) is 5.1%.
| Range | Selected | |
| Cost of equity | 7.7% - 10.4% | 9.05% |
| Tax rate | 30.0% - 45.1% | 37.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.9% - 5.3% | 5.1% |
| Category | Low | High |
| Long-term bond rate | 3.0% | 3.5% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 0.8 | 0.94 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.7% | 10.4% |
| Tax rate | 30.0% | 45.1% |
| Debt/Equity ratio | 2 | 2 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.9% | 5.3% |
| Selected WACC | 5.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| UBI.PA | Ubisoft Entertainment SA | 2 | 0.9 | 0.4 |
| CDR.WA | CD Projekt SA | 0 | 0.57 | 0.57 |
| EMBRAC B.ST | Embracer Group AB | 0.1 | 0.83 | 0.78 |
| FLEXM.ST | Flexion Mobile PLC | 0.01 | 0.33 | 0.33 |
| GMR.L | Gaming Realms PLC | 0.01 | -0.24 | -0.24 |
| M8G.DE | MEDIA AND GAMES INVEST PLC | 1.26 | 0.39 | 0.22 |
| NITRO.ST | Nitro Games Oyj | 0.9 | 0.17 | 0.11 |
| PDX.ST | Paradox Interactive AB (publ) | 0 | 0.69 | 0.69 |
| ROVIO.HE | Rovio Entertainment Oyj | 0.01 | -0.12 | -0.12 |
| SF.ST | Stillfront Group AB (publ) | 1.51 | 0.82 | 0.42 |
| Low | High | |
| Unlevered beta | 0.29 | 0.41 |
| Relevered beta | 0.7 | 0.91 |
| Adjusted relevered beta | 0.8 | 0.94 |
UBI.PA'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 UBI.PA:
cost_of_equity (9.05%) = risk_free_rate (3.25%) + equity_risk_premium (6.30%) * adjusted_beta (0.8) + 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.