W7L.L WACC - Weighted Average Cost of Capital

The WACC of Warpaint London PLC (W7L.L) is 7.3%.

The Cost of Equity of Warpaint London PLC (W7L.L) is 7.35%.

The Cost of Debt of Warpaint London PLC (W7L.L) is 4.90%.

	Range	Selected
Cost of equity	6.50% - 8.20%	7.35%
Tax rate	21.30% - 23.10%	22.20%
Cost of debt	4.60% - 5.20%	4.90%
WACC	6.4% - 8.1%	7.3%

WACC

W7L.L WACC calculation

Category	Low	High

Long-term bond rate	4.0%	4.5%
Equity market risk premium	6.0%	7.0%
Adjusted beta	0.41	0.46

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.50%	8.20%

Tax rate	21.30%	23.10%
Debt/Equity ratio	0.02	0.02
Cost of debt	4.60%	5.20%

After-tax WACC	6.4%	8.1%


Selected WACC	7.3%

W7L.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 W7L.L:

cost_of_equity (7.35%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.41) + 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.