ABSA Bank KenyaNAI:ABSA +0.31%75 WACC % is 15.31% as of Jul. 03, 2026, which is 3% above its 10-year median of 14.84. GuruFocus rates NAI:ABSA with a GF Score™ of 75/100 and a GF Value™ of KES16.07 (Significantly Overvalued). The stock has 5 warning signs investors should review. Among 1,544 Banks companies, ABSA Bank Kenya ranks worse than 62.31% on this metric.
As of today (2026-07-03), ABSA Bank Kenya's weighted average cost of capital is 15.31%%. ABSA Bank Kenya's ROIC % is 0.00% (calculated using TTM income statement data).
ABSA Bank Kenya earns returns that do not match up to its cost of capital. It will destroy value as it grows.
*Note: The beta of this company cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
For a comprehensive WACC calculation, please access the WACC Calculator.
ABSA Bank Kenya (NAI:ABSA) 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, ABSA Bank Kenya's weighted average cost of capital is 15.31%%. ABSA Bank Kenya's ROIC % is 0.00% (calculated using TTM income statement data).
ABSA Bank Kenya earns returns that do not match up to its cost of capital. It will destroy value as it grows.
*Note: The beta of this company cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year quarterly 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 quarterly average debt to get the simplified cost of debt.
Related Terms
ABSA Bank Kenya WACC % Historical Data
* Premium members only.
The historical data trend for ABSA Bank Kenya'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 Banks - Regional subindustry, ABSA Bank Kenya'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.
ABSA Bank Kenya WACC % vs Banks Industry
For the Banks industry and Financial Services sector, ABSA Bank Kenya's WACC % distribution charts can be found below:
* The bar in red indicates where ABSA Bank Kenya'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, ABSA Bank Kenya's market capitalization (E) is KES177882.804 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 quarterly average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Mar. 2026, ABSA Bank Kenya's latest one-year quarterly average Book Value of Debt (D) is KES6870.8208 Mil.
a) weight of equity = E / (E + D) = 177882.804 / (177882.804 + 6870.8208) = 0.9628
b) weight of debt = D / (E + D) = 6870.8208 / (177882.804 + 6870.8208) = 0.0372
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 4.485%. 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. ABSA Bank Kenya's beta cannot be obtained because it has a price history shorter than 3 years. It will thus be set to 1 as default to calculate WACC.
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 = 4.485% + 1 * 6% = 10.485%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year quarterly average debt to get the simplified cost of debt.
As of Mar. 2026, ABSA Bank Kenya's interest expense (positive number) was KES13735.708 Mil. Its total Book Value of Debt (D) is KES6870.8208 Mil.
Cost of Debt = 13735.708 / 6870.8208 = 199.9136%.
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 = 9389.395 / 31440.035 = 29.86%.
ABSA Bank Kenya'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)
=
0.9628
*
10.485%
+
0.0372
*
199.9136%
*
(1 - 29.86%)
=
15.31%
* 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.
ABSA Bank Kenya (NAI:ABSA) has a WACC % of 15.31% as of Jul. 03, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on ABSA Bank Kenya and its competitors. This is near median its historical median of 14.84. Over the past decade, ABSA Bank Kenya's WACC % has ranged from 12.48 to 21.28. According to the industry distribution chart, ABSA Bank Kenya ranks #962 out of 1544 companies in the Banks industry, placing it in the top 62.3%.
Is ABSA Bank Kenya's WACC % too high?
ABSA Bank Kenya's current WACC % of 15.31% is near median its 10-year median of 14.84. Over the past 10 years, this metric has ranged from a low of 12.48 to a high of 21.28. The Banks industry median WACC % is 13.17. ABSA Bank Kenya's value of 15.31% is 16.2% above this industry median. Based on the distribution chart, ABSA Bank Kenya ranks #962 out of 1544 companies in the Banks industry, which is below the industry midpoint. Overall, ABSA Bank Kenya has a GF Score™ of 75/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does ABSA Bank Kenya's WACC % compare to competitors?
According to the Banks industry distribution chart, ABSA Bank Kenya ranks #962 out of 1544 companies for WACC %. This places ABSA Bank Kenya in the lower half of its industry. The industry median WACC % is 13.17. ABSA Bank Kenya's value of 15.31% is 16.2% above this benchmark. Historically, ABSA Bank Kenya's own WACC % has ranged from 12.48 to 21.28 over the past decade. While the company's 10-year median is 14.84 vs. the industry median of 13.17, ABSA Bank Kenya 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 Banks company?
The median WACC % among Banks companies is 13.17, based on 1,544 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. ABSA Bank Kenya's current WACC % of 15.31% is 16.2% 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 ABSA Bank Kenya and its competitors. For the Banks industry, the median WACC % is 13.17 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. ABSA Bank Kenya's current WACC % is 15.31%, which is near median its own 10-year median of 14.84. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is ABSA Bank Kenya stock overvalued right now?
Based on GuruFocus' analysis, ABSA Bank Kenya (NAI:ABSA) is currently considered Significantly Overvalued. The stock's GF Value™ is KES16.07, compared to a current price of KES32.75 — trading 103.8% above its estimated fair value. The current WACC % is 15.31%, which is near median its 10-year median of 14.84 and 16.2% above the Banks industry median of 13.17. ABSA Bank Kenya's overall GF Score™ is 75/100 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 ABSA Bank Kenya (NAI:ABSA), the current WACC % is 15.31% as of Jul. 03, 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 ABSA Bank Kenya (NAI:ABSA) Overvalued in 2026?
Based on GuruFocus' analysis, ABSA Bank Kenya stock appears to be overvalued.
The current stock price of KES32.75 is trading 103.8% above its estimated GF Value™ of KES16.07.
GuruFocus considers ABSA Bank Kenya to be Significantly Overvalued.
Key valuation signals for NAI:ABSA:
WACC %: 15.31% (near median its 10-year median of 14.84)
GF Value™: KES16.07 vs. price of KES32.75 (103.8% above fair value)
Industry Position: 16.2% above the Banks median (#962 of 1544)
No single metric tells the full story. See the NAI:ABSA stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
ABSA Bank Kenya PLC is a diversified financial services company offering clients a range of retail, business, corporate and investment, and wealth management solutions. The company's operating segment includes Consumer banking and Corporate banking. It generates maximum revenue from the Consumer Banking segment. The Consumer Banking segment incorporates private customer current accounts, savings, deposits, credit and debit cards, consumer loans, and mortgages. Its Corporate Banking segment includes the business model that centers on delivering specialist investment banking, financing, risk management, and advisory solutions across asset classes to corporates, financial institutions and government clients.
75GF Score
Get the complete analysis for NAI:ABSA
WACC % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
NAI:ABSA has been successfully added to your 
