VPBN.SW WACC - Weighted Average Cost of Capital
The WACC of VP Bank AG (VPBN.SW) is 6.4%.
| Range | Selected | |
| Cost of equity | 5.2% - 9.4% | 7.3% |
| Tax rate | 12.8% - 14.3% | 13.55% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.0% - 7.9% | 6.4% |
| Category | Low | High |
| Long-term bond rate | 1.0% | 1.5% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.83 | 1.21 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.2% | 9.4% |
| Tax rate | 12.8% | 14.3% |
| Debt/Equity ratio | 0.41 | 0.41 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.0% | 7.9% |
| Selected WACC | 6.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| VPBN.SW | VP Bank AG | 0.41 | 0.42 | 0.31 |
| BBN.SW | Bellevue Group AG | 0.17 | 0.6 | 0.53 |
| BRK.L | Brooks Macdonald Group PLC | 0.02 | 0.38 | 0.37 |
| DEA.MI | DeA Capital SpA | 0.17 | -0.01 | -0.01 |
| EQV1V.HE | eQ Oyj | 0.01 | 0.57 | 0.57 |
| GHE.L | Gresham House PLC | 0 | 1.4 | 1.4 |
| LIO.L | Liontrust Asset Management PLC | 0.02 | 1.69 | 1.67 |
| OCI.L | Oakley Capital Investments Ltd | 0.13 | 0.95 | 0.85 |
| POLR.L | Polar Capital Holdings PLC | 0.01 | 1.87 | 1.85 |
| XPS.L | XPS Pensions Group PLC | 0.04 | 1.19 | 1.15 |
| Low | High | |
| Unlevered beta | 0.55 | 0.97 |
| Relevered beta | 0.75 | 1.31 |
| Adjusted relevered beta | 0.83 | 1.21 |
VPBN.SW'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 VPBN.SW:
cost_of_equity (7.30%) = risk_free_rate (1.25%) + equity_risk_premium (5.60%) * adjusted_beta (0.83) + 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.