WPR.AX WACC - Weighted Average Cost of Capital
The WACC of Waypoint REIT Ltd (WPR.AX) is 6.8%.
| Range | Selected | |
| Cost of equity | 7.2% - 9.5% | 8.35% |
| Tax rate | 30.0% - 30.0% | 30% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 5.6% - 7.9% | 6.8% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.62 | 0.74 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.2% | 9.5% |
| Tax rate | 30.0% | 30.0% |
| Debt/Equity ratio | 0.55 | 0.55 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 5.6% | 7.9% |
| Selected WACC | 6.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| WPR.AX | Waypoint REIT Ltd | 0.55 | 0.32 | 0.23 |
| AQR.AX | APN Convenience Retail REIT | 0.42 | 0.77 | 0.6 |
| BWP.AX | BWP Trust | 0.3 | 0.38 | 0.31 |
| CDP.AX | Carindale Property Trust | 0.54 | 0.09 | 0.06 |
| CQR.AX | Charter Hall Retail REIT | 0.45 | 0.25 | 0.19 |
| ERF.AX | Elanor Retail Property Fund | 0.42 | 0.69 | 0.53 |
| NSR.AX | National Storage Reit | 0.45 | 0.63 | 0.48 |
| SCG.AX | Scentre Group | 0.84 | 0.77 | 0.48 |
| SCP.AX | Shopping Centres Australasia Property Group Re Ltd | 0.5 | 0.68 | 0.5 |
| VCX.AX | Vicinity Centres | 0.4 | 0.53 | 0.41 |
| Low | High | |
| Unlevered beta | 0.37 | 0.48 |
| Relevered beta | 0.43 | 0.61 |
| Adjusted relevered beta | 0.62 | 0.74 |
WPR.AX'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 WPR.AX:
cost_of_equity (8.35%) = risk_free_rate (4.25%) + equity_risk_premium (5.60%) * 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.