UGE.V WACC - Weighted Average Cost of Capital

The WACC of UGE International Ltd (UGE.V) is 7.9%.

The Cost of Equity of UGE International Ltd (UGE.V) is 10.95%.

The Cost of Debt of UGE International Ltd (UGE.V) is 6.10%.

	Range	Selected
Cost of equity	8.70% - 13.20%	10.95%
Tax rate	0.30% - 1.80%	1.05%
Cost of debt	5.20% - 7.00%	6.10%
WACC	6.5% - 9.2%	7.9%

WACC

UGE.V WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.95	1.36

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.70%	13.20%

Tax rate	0.30%	1.80%
Debt/Equity ratio	1.69	1.69
Cost of debt	5.20%	7.00%

After-tax WACC	6.5%	9.2%


Selected WACC	7.9%

UGE.V'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 UGE.V:

cost_of_equity (10.95%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.95) + 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.