Zoo Digital GroupLSE:ZOO 50 WACC % is 11.18% as of Jun. 30, 2026, which is 67% above its 10-year median of 6.69. GuruFocus rates LSE:ZOO with a GF Score™ of 50/100 and a GF Value™ of £0.29 (Possible Value Trap). The stock has 4 warning signs investors should review. Among 2,910 Software companies, Zoo Digital Group ranks worse than 69.97% on this metric.
As of today (2026-06-30), Zoo Digital Group's weighted average cost of capital is 11.18%%. Zoo Digital Group's ROIC % is -17.57% (calculated using TTM income statement data).
Zoo Digital Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
For a comprehensive WACC calculation, please access the WACC Calculator.
Zoo Digital Group (LSE:ZOO) 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, Zoo Digital Group's weighted average cost of capital is 11.18%%. Zoo Digital Group's ROIC % is -17.57% (calculated using TTM income statement data).
Zoo Digital Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
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
Zoo Digital Group WACC % Historical Data
* Premium members only.
The historical data trend for Zoo Digital Group'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 Software - Application subindustry, Zoo Digital Group'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.
Zoo Digital Group WACC % vs Software Industry
For the Software industry and Technology sector, Zoo Digital Group's WACC % distribution charts can be found below:
* The bar in red indicates where Zoo Digital Group'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, Zoo Digital Group's market capitalization (E) is £11.061 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 Sep. 2025, Zoo Digital Group's latest one-year semi-annual average Book Value of Debt (D) is £3.995 Mil.
a) weight of equity = E / (E + D) = 11.061 / (11.061 + 3.995) = 0.7347
b) weight of debt = D / (E + D) = 3.995 / (11.061 + 3.995) = 0.2653
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 4.9416%. 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. Zoo Digital Group's beta is 1.2556.
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 = 4.9416% + 1.2556 * 6% = 12.4752%
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 Sep. 2025, Zoo Digital Group's interest expense (positive number) was £0.318 Mil. Its total Book Value of Debt (D) is £3.995 Mil.
Cost of Debt = 0.318 / 3.995 = 7.9599%.
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 = -0.251 / -5.394 = 4.65%.
Zoo Digital Group'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)
=
0.7347
*
12.4752%
+
0.2653
*
7.9599%
*
(1 - 4.65%)
=
11.18%
* 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.
Zoo Digital Group (LSE:ZOO) has a WACC % of 11.18% as of Jun. 30, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Zoo Digital Group and its competitors. This is 67% above median its historical median of 6.69. According to the industry distribution chart, Zoo Digital Group ranks #2036 out of 2910 companies in the Software industry, placing it in the top 70%.
Is Zoo Digital Group's WACC % too high?
Zoo Digital Group's current WACC % of 11.18% is 67% above median its 10-year median of 6.69. The Software industry median WACC % is 8.95. Zoo Digital Group's value of 11.18% is 24.9% above this industry median. Based on the distribution chart, Zoo Digital Group ranks #2036 out of 2910 companies in the Software industry, which is below the industry midpoint. Overall, Zoo Digital Group has a GF Score™ of 50/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Zoo Digital Group's WACC % compare to UBER and SHOP?
According to the Software industry distribution chart, Zoo Digital Group ranks #2036 out of 2910 companies for WACC %. This places Zoo Digital Group in the lower half of its industry. The industry median WACC % is 8.95. Zoo Digital Group's value of 11.18% is 24.9% above this benchmark. While the company's 10-year median is 6.69 vs. the industry median of 8.95, Zoo Digital Group 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 Software company?
The median WACC % among Software companies is 8.95, based on 2,910 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. Zoo Digital Group's current WACC % of 11.18% is 24.9% 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 Zoo Digital Group and its competitors. For the Software industry, the median WACC % is 8.95 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Zoo Digital Group's current WACC % is 11.18%, which is 67% above median its own 10-year median of 6.69. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Zoo Digital Group stock overvalued right now?
Based on GuruFocus' analysis, Zoo Digital Group (LSE:ZOO) is currently considered Possible Value Trap. The stock's GF Value™ is £0.29, compared to a current price of £0.11 — trading 61.2% below its estimated fair value. The current WACC % is 11.18%, which is 67% above median its 10-year median of 6.69 and 24.9% above the Software industry median of 8.95. Zoo Digital Group's overall GF Score™ is 50/100 with 4 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 Zoo Digital Group (LSE:ZOO), the current WACC % is 11.18% as of Jun. 30, 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 Zoo Digital Group (LSE:ZOO) Overvalued in 2026?
Based on GuruFocus' analysis, Zoo Digital Group stock appears to be undervalued.
The current stock price of £0.11 is trading 61.2% below its estimated GF Value™ of £0.29.
GuruFocus considers Zoo Digital Group to be Possible Value Trap.
Key valuation signals for LSE:ZOO:
WACC %: 11.18% (67% above median its 10-year median of 6.69)
GF Value™: £0.29 vs. price of £0.11 (61.2% below fair value)
Industry Position: 24.9% above the Software median (#2036 of 2910)
No single metric tells the full story. See the LSE:ZOO stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Zoo Digital Group PLC through its subsidiaries provides cloud technology services. Its services are used for digital content authoring, video post-production, and localisation for entertainment, publishing, and packaging markets. The company's operating segment includes Media Production and Software solutions. Media Production includes localisation and media services. It generates maximum revenue from the Media Production segment. Geographically, it operates in the United Kingdom and the United States, out of which it derives the majority of its revenue from the United States.
50GF Score
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