The WACC of Urbas Grupo Financiero SA (UBS.MC) is 4.6%.
Range | Selected | |
Cost of equity | 5.6% - 8.6% | 7.1% |
Tax rate | 4.7% - 10.3% | 7.5% |
Cost of debt | 4.0% - 4.5% | 4.25% |
WACC | 4.2% - 4.9% | 4.6% |
Category | Low | High |
Long-term bond rate | 3.1% | 3.6% |
Equity market risk premium | 7.4% | 8.4% |
Adjusted beta | 0.34 | 0.54 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 5.6% | 8.6% |
Tax rate | 4.7% | 10.3% |
Debt/Equity ratio | 4.08 | 4.08 |
Cost of debt | 4.0% | 4.5% |
After-tax WACC | 4.2% | 4.9% |
Selected WACC | 4.6% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
UBS.MC | Urbas Grupo Financiero SA | 4.08 | 0.68 | 0.14 |
ASPL.L | Aseana Properties Ltd | 1.37 | -0.49 | -0.22 |
DCI.L | Dolphin Capital Investors Ltd | 0.54 | 0.01 | 0 |
EDI.WA | ED Invest SA | 0.09 | 0.16 | 0.15 |
HMI.WA | HM Inwest SA | 0.54 | -0.07 | -0.05 |
I2D.WA | I2 Development SA | 1.47 | 0.49 | 0.21 |
JWC.WA | JW Construction Holding SA | 0.94 | 0.03 | 0.01 |
LKD.WA | Lokum Deweloper SA | 0.19 | -0.06 | -0.05 |
NUVA.DE | Noratis AG | 35.82 | 0.07 | 0 |
PKG1T.TL | Pro Kapital Grupp AS | 0.65 | 1.17 | 0.73 |
Low | High | |
Unlevered beta | 0 | 0.06 |
Relevered beta | 0.01 | 0.31 |
Adjusted relevered beta | 0.34 | 0.54 |
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 UBS.MC:
cost_of_equity (7.10%) = risk_free_rate (3.35%) + equity_risk_premium (7.90%) * adjusted_beta (0.34) + 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.