VANL.L WACC - Weighted Average Cost of Capital

The WACC of Van Elle Holdings PLC (VANL.L) is 8.3%.

The Cost of Equity of Van Elle Holdings PLC (VANL.L) is 9.10%.

The Cost of Debt of Van Elle Holdings PLC (VANL.L) is 5.25%.

	Range	Selected
Cost of equity	7.70% - 10.50%	9.10%
Tax rate	11.60% - 17.80%	14.70%
Cost of debt	4.60% - 5.90%	5.25%
WACC	7.1% - 9.6%	8.3%

WACC

VANL.L WACC calculation

Category	Low	High

Long-term bond rate	4.0%	4.5%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.62	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.70%	10.50%

Tax rate	11.60%	17.80%
Debt/Equity ratio	0.2	0.2
Cost of debt	4.60%	5.90%

After-tax WACC	7.1%	9.6%


Selected WACC	8.3%

VANL.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 VANL.L:

cost_of_equity (9.10%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.62) + 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.