ZOE.L WACC - Weighted Average Cost of Capital
The WACC of Zoetic International PLC (ZOE.L) is 7.8%.
| Range | Selected | |
| Cost of equity | 6.7% - 9.0% | 7.85% |
| Tax rate | 19.0% - 19.0% | 19% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.7% - 9.0% | 7.8% |
| Category | Low | High |
| Long-term bond rate | 2.9% | 3.4% |
| Equity market risk premium | 5.3% | 6.3% |
| Adjusted beta | 0.71 | 0.8 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.7% | 9.0% |
| Tax rate | 19.0% | 19.0% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.7% | 9.0% |
| Selected WACC | 7.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ZOE.L | Zoetic International PLC | 0.01 | 0.55 | 0.54 |
| AEX.L | Aminex PLC | 0.88 | 0.92 | 0.54 |
| CASP.L | Caspian Sunrise PLC | 0.08 | 0.51 | 0.48 |
| I3E.L | I3 Energy PLC | 0.23 | 0.23 | 0.19 |
| LFDE.PA | La Francaise de l Energie SA | 0.16 | 0.93 | 0.82 |
| PANR.L | Pantheon Resources PLC | 0.06 | 0.08 | 0.08 |
| SAVE.L | Savannah Energy PLC | 4.2 | 0.42 | 0.1 |
| SEY.L | Sterling Energy PLC | 0.02 | 0.3 | 0.29 |
| SLE.L | San Leon Energy PLC | 0.03 | 2.73 | 2.67 |
| WEN.L | Wentworth Resources PLC | 0 | -0.09 | -0.09 |
| Low | High | |
| Unlevered beta | 0.25 | 0.51 |
| Relevered beta | 0.57 | 0.7 |
| Adjusted relevered beta | 0.71 | 0.8 |
ZOE.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 ZOE.L:
cost_of_equity (7.85%) = risk_free_rate (3.15%) + equity_risk_premium (5.80%) * adjusted_beta (0.71) + 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.