The WACC of Vakif Menkul Kiymet Yatirim Ortakligi AS (VKFYO.IS) is 27.8%.
| Range | Selected | |
| Cost of equity | 26.30% - 29.30% | 27.80% |
| Tax rate | 21.20% - 22.00% | 21.60% |
| Cost of debt | 5.00% - 5.00% | 5.00% |
| WACC | 26.3% - 29.3% | 27.8% |
| Category | Low | High |
| Long-term bond rate | 21.4% | 21.9% |
| Equity market risk premium | 10.2% | 11.2% |
| Adjusted beta | 0.49 | 0.62 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 26.30% | 29.30% |
| Tax rate | 21.20% | 22.00% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 5.00% | 5.00% |
| After-tax WACC | 26.3% | 29.3% |
| Selected WACC | 27.8% | |
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 VKFYO.IS:
cost_of_equity (27.80%) = risk_free_rate (21.65%) + equity_risk_premium (10.70%) * adjusted_beta (0.49) + 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.