Bahamas Petroleum Company PLC (BPC.L) WACC Analysis

As of May 28, 2025, Bahamas Petroleum Company PLC (BPC.L) carries a Weighted Average Cost of Capital (WACC) of 11.1%. WACC reflects the blended rate Bahamas Petroleum Company PLC must pay to both equity and debt holders.

Within that, the cost of equity is 9.3%, the cost of debt is 5.0%, and the effective tax rate is 19.0%.

Breakdown of WACC Components

• Long-term bond rate: 2.9% – 3.4%
• Equity market risk premium: 5.3% – 6.3%
• Adjusted beta: 1.18 – 1.45
• Additional risk adjustment: 0.0% – 0.5%
• Debt-to-equity ratio: 0.01

What It Means for Investors

With a selected WACC of 11.1%, Bahamas Petroleum Company PLC must ensure any new investment returns exceed this threshold to generate shareholder value. This level reflects a relatively high financing requirement.