ZUE.WA WACC - Weighted Average Cost of Capital

The WACC of ZUE SA (ZUE.WA) is 9.7%.

The Cost of Equity of ZUE SA (ZUE.WA) is 10.80%.

The Cost of Debt of ZUE SA (ZUE.WA) is 9.50%.

	Range	Selected
Cost of equity	9.60% - 12.00%	10.80%
Tax rate	22.60% - 24.60%	23.60%
Cost of debt	5.00% - 14.00%	9.50%
WACC	7.8% - 11.5%	9.7%

WACC

ZUE.WA WACC calculation

Category	Low	High

Long-term bond rate	5.5%	6.0%
Equity market risk premium	6.3%	7.3%
Adjusted beta	0.65	0.75

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.60%	12.00%

Tax rate	22.60%	24.60%
Debt/Equity ratio	0.45	0.45
Cost of debt	5.00%	14.00%

After-tax WACC	7.8%	11.5%


Selected WACC	9.7%

ZUE.WA'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 ZUE.WA:

cost_of_equity (10.80%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.65) + 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.