LLN.MC WACC - Weighted Average Cost of Capital

The WACC of Lleidanetworks Serveis Telematics SA (LLN.MC) is 8.5%.

The Cost of Equity of Lleidanetworks Serveis Telematics SA (LLN.MC) is 9.70%.

The Cost of Debt of Lleidanetworks Serveis Telematics SA (LLN.MC) is 5.50%.

	Range	Selected
Cost of equity	8.10% - 11.30%	9.70%
Tax rate	2.30% - 3.60%	2.95%
Cost of debt	4.00% - 7.00%	5.50%
WACC	7.0% - 10.0%	8.5%

WACC

LLN.MC WACC calculation

Category	Low	High

Long-term bond rate	3.1%	3.6%
Equity market risk premium	7.4%	8.4%
Adjusted beta	0.68	0.85

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.10%	11.30%

Tax rate	2.30%	3.60%
Debt/Equity ratio	0.37	0.37
Cost of debt	4.00%	7.00%

After-tax WACC	7.0%	10.0%


Selected WACC	8.5%

LLN.MC'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 LLN.MC:

cost_of_equity (9.70%) = risk_free_rate (3.35%) + equity_risk_premium (7.90%) * adjusted_beta (0.68) + 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.