Kumba Iron OreFRA:KUI -1.30%72 WACC % is 15.26% as of Jun. 26, 2026, which is 6% below its 10-year median of 16.29. GuruFocus rates FRA:KUI with a GF Score™ of 72/100 and a GF Value™ of €17.65 (Modestly Undervalued). The stock has 5 warning signs investors should review. Among 642 Steel companies, Kumba Iron Ore ranks worse than 89.1% on this metric.
As of today (2026-06-26), Kumba Iron Ore's weighted average cost of capital is 15.26%%. Kumba Iron Ore's ROIC % is 24.49% (calculated using TTM income statement data).
Kumba Iron Ore generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
For a comprehensive WACC calculation, please access the WACC Calculator.
Kumba Iron Ore (FRA:KUI) WACC % Explanation
Because it costs money to raise capital. A firm that generates higher ROIC % than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Kumba Iron Ore's weighted average cost of capital is 15.26%%. Kumba Iron Ore's ROIC % is 24.49% (calculated using TTM income statement data).
Kumba Iron Ore generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.
For companies that report quarterly, GuruFocus combines all of the most recent year's quarterly debt data from the beginning of the year to the year-end and calculates the average.
For companies that report semi-annually, GuruFocus combines all of the most recent year's semi-annual debt data from the start of the year to the year-end and calculates the average.
For companies that report annually, GuruFocus combines the beginning and ending annual debt data from the most recent year and then calculates the average.
2. The WACC formula discussed above does not include Preferred Stock. Please adjust if preferred stock is considered.
3. (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
4. GuruFocus uses the latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
Related Terms
Kumba Iron Ore WACC % Historical Data
* Premium members only.
The historical data trend for Kumba Iron Ore's WACC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Steel subindustry, Kumba Iron Ore's WACC %, along with its competitors' market caps and WACC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Kumba Iron Ore WACC % vs Steel Industry
For the Steel industry and Basic Materials sector, Kumba Iron Ore's WACC % distribution charts can be found below:
* The bar in red indicates where Kumba Iron Ore's WACC % falls into.
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of capital. Generally speaking, a company's assets are financed by debt and equity. WACC is the average of the costs of these sources of financing, each of which is weighted by its respective use in the given situation. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances.
WACC
=
E
/
(E + D)
*
Cost of Equity
+
D
/
(E + D)
*
Cost of Debt
*
(1 - Tax Rate)
1. Weights:
Generally speaking, a company's assets are financed by debt and equity. We need to calculate the weight of equity and the weight of debt.
The market value of equity (E) is also called "Market Cap". As of today, Kumba Iron Ore's market capitalization (E) is €4963.048 Mil.
The market value of debt is typically difficult to calculate, therefore, GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding the latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Dec. 2025, Kumba Iron Ore's latest one-year semi-annual average Book Value of Debt (D) is €45.664 Mil.
a) weight of equity = E / (E + D) = 4963.048 / (4963.048 + 45.664) = 0.9909
b) weight of debt = D / (E + D) = 45.664 / (4963.048 + 45.664) = 0.0091
2. Cost of Equity:
GuruFocus uses Capital Asset Pricing Model (CAPM) to calculate the required rate of return. The formula is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
a) GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate. It is updated daily. The current risk-free rate is 8.995%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default.
b) Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. Kumba Iron Ore's beta is 0.9563.
c) (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
Cost of Equity = 8.995% + 0.9563 * 6% = 14.7328%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
As of Dec. 2025, Kumba Iron Ore's interest expense (positive number) was €45.639 Mil. Its total Book Value of Debt (D) is €45.664 Mil.
Cost of Debt = 45.639 / 45.664 = 99.9453%.
4. Multiply by one minus TTM Tax Rate:
GuruFocus uses the most recent TTM Tax Expense divided by the most recent TTM Pre-Tax Income to calculate the tax rate. The calculated TTM tax rate is limited to between 0% and 100%. If the calculated tax rate is higher than 100%, it is set to 100%. If the calculated tax rate is less than 0%, it is set to 0%.
The latest calculated TTM Tax Rate = 350.813 / 1303.305 = 26.92%.
Kumba Iron Ore's Weighted Average Cost Of Capital (WACC) for Today is calculated as:
WACC
=
E / (E + D)
*
Cost of Equity
+
D / (E + D)
*
Cost of Debt
*
(1 - Tax Rate)
=
0.9909
*
14.7328%
+
0.0091
*
99.9453%
*
(1 - 26.92%)
=
15.26%
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Kumba Iron Ore (FRA:KUI) has a WACC % of 15.26% as of Jun. 26, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Kumba Iron Ore and its competitors. This is near median its historical median of 16.29. Over the past decade, Kumba Iron Ore's WACC % has ranged from 6.17 to 20.14. According to the industry distribution chart, Kumba Iron Ore ranks #572 out of 642 companies in the Steel industry, placing it in the top 89.1%.
Is Kumba Iron Ore's WACC % too high?
Kumba Iron Ore's current WACC % of 15.26% is near median its 10-year median of 16.29. Over the past 10 years, this metric has ranged from a low of 6.17 to a high of 20.14. The Steel industry median WACC % is 7.78. Kumba Iron Ore's value of 15.26% is 96.3% above this industry median. Based on the distribution chart, Kumba Iron Ore ranks #572 out of 642 companies in the Steel industry, which is in the bottom quartile relative to peers. Overall, Kumba Iron Ore has a GF Score™ of 72/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Kumba Iron Ore's WACC % compare to NUE and STLD?
According to the Steel industry distribution chart, Kumba Iron Ore ranks #572 out of 642 companies for WACC %. This places Kumba Iron Ore in the lower half of its industry. The industry median WACC % is 7.78. Kumba Iron Ore's value of 15.26% is 96.3% above this benchmark. Historically, Kumba Iron Ore's own WACC % has ranged from 6.17 to 20.14 over the past decade. While the company's 10-year median is 16.29 vs. the industry median of 7.78, Kumba Iron Ore has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good WACC % for a Steel company?
The median WACC % among Steel companies is 7.78, based on 642 companies in the industry. Companies in the top quartile (top 25%) have a WACC % significantly above this median, while those in the bottom quartile fall well below. However, WACC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Kumba Iron Ore's current WACC % of 15.26% is 96.3% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high WACC % mean?
A high WACC % can signal that a stock is expensive relative to its fundamentals. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Kumba Iron Ore and its competitors. For the Steel industry, the median WACC % is 7.78 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Kumba Iron Ore's current WACC % is 15.26%, which is near median its own 10-year median of 16.29. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Kumba Iron Ore stock overvalued right now?
Based on GuruFocus' analysis, Kumba Iron Ore (FRA:KUI) is currently considered Modestly Undervalued. The stock's GF Value™ is €17.65, compared to a current price of €15.20 — trading 13.9% below its estimated fair value. The current WACC % is 15.26%, which is near median its 10-year median of 16.29 and 96.3% above the Steel industry median of 7.78. Kumba Iron Ore's overall GF Score™ is 72/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is WACC % calculated?
WACC % is calculated from a company's financial statements. For Kumba Iron Ore (FRA:KUI), the current WACC % is 15.26% as of Jun. 26, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Kumba Iron Ore (FRA:KUI) Overvalued in 2026?
Based on GuruFocus' analysis, Kumba Iron Ore stock appears to be undervalued.
The current stock price of €15.20 is trading 13.9% below its estimated GF Value™ of €17.65.
GuruFocus considers Kumba Iron Ore to be Modestly Undervalued.
Key valuation signals for FRA:KUI:
WACC %: 15.26% (near median its 10-year median of 16.29)
GF Value™: €17.65 vs. price of €15.20 (13.9% below fair value)
Industry Position: 96.3% above the Steel median (#572 of 642)
No single metric tells the full story. See the FRA:KUI stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Kumba Iron Ore Ltd is engaged in the exploration, mining, processing, blending, and sale of iron ore to the steel industry. The company operates in South Africa, with mining operations in the Northern Cape and Limpopo provinces, as well as a head office in Centurion, Gauteng, and a port operation in Saldanha Bay, Western Cape. The company's flagship asset is the Sishen mine, which it holds a majority stake in, located near the town of Kathu in the Northern Cape Province. The Sishen mine is opencast and produces the bulk of the group's iron ore, which is exported. It also holds an interest in the Kolomela mine. The company also generates revenue from Shipping operations. The majority of the company's revenue is generated from its products.
72GF Score
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