VAF.LS WACC - Weighted Average Cost of Capital

The WACC of VAA Vista Alegre Atlantis SGPS SA (VAF.LS) is 6.5%.

The Cost of Equity of VAA Vista Alegre Atlantis SGPS SA (VAF.LS) is 7.90%.

The Cost of Debt of VAA Vista Alegre Atlantis SGPS SA (VAF.LS) is 5.00%.

	Range	Selected
Cost of equity	5.30% - 10.50%	7.90%
Tax rate	20.30% - 26.60%	23.45%
Cost of debt	5.00% - 5.00%	5.00%
WACC	4.9% - 8.2%	6.5%

WACC

VAF.LS WACC calculation

Category	Low	High

Long-term bond rate	2.9%	3.4%
Equity market risk premium	6.9%	7.8%
Adjusted beta	0.35	0.84

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.30%	10.50%

Tax rate	20.30%	26.60%
Debt/Equity ratio	0.51	0.51
Cost of debt	5.00%	5.00%

After-tax WACC	4.9%	8.2%


Selected WACC	6.5%

VAF.LS'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 VAF.LS:

cost_of_equity (7.90%) = risk_free_rate (3.15%) + equity_risk_premium (7.35%) * 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.