Barratt Developments P L C (BDEV.L) WACC Analysis

As of May 25, 2025, Barratt Developments P L C (BDEV.L) carries a Weighted Average Cost of Capital (WACC) of 10.5%. WACC reflects the blended rate Barratt Developments P L C must pay to both equity and debt holders.

Within that, the cost of equity is 8.9%, the cost of debt is 4.0%, and the effective tax rate is 18.7%.

Breakdown of WACC Components

• Long-term bond rate: 4.0% – 4.5%
• Equity market risk premium: 6.0% – 7.0%
• Adjusted beta: 0.81 – 1.11
• Additional risk adjustment: 0.0% – 0.5%
• Debt-to-equity ratio: 0.04

What It Means for Investors

With a selected WACC of 10.5%, Barratt Developments P L C must ensure any new investment returns exceed this threshold to generate shareholder value. This level reflects a relatively high financing requirement.