As of today (2026-07-01), Gulf Keystone Petroleum's weighted average cost of capital is 10.84%%. Gulf Keystone Petroleum's ROIC % is 2.93% (calculated using TTM income statement data).
Gulf Keystone Petroleum 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.
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, Gulf Keystone Petroleum's weighted average cost of capital is 10.84%%. Gulf Keystone Petroleum's ROIC % is 2.93% (calculated using TTM income statement data).
Gulf Keystone Petroleum 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 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.
* 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 Oil & Gas E&P subindustry, Gulf Keystone Petroleum'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.
Gulf Keystone Petroleum WACC % vs Oil & Gas Industry
For the Oil & Gas industry and Energy sector, Gulf Keystone Petroleum's WACC % distribution charts can be found below:
* The bar in red indicates where Gulf Keystone Petroleum'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, Gulf Keystone Petroleum's market capitalization (E) is kr5050.513 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, Gulf Keystone Petroleum's latest one-year semi-annual average Book Value of Debt (D) is kr15.257 Mil.
a) weight of equity = E / (E + D) = 5050.513 / (5050.513 + 15.257) = 0.997
b) weight of debt = D / (E + D) = 15.257 / (5050.513 + 15.257) = 0.003
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 4.481%. 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. Gulf Keystone Petroleum'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 = 4.481% + 1 * 6% = 10.481%
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, Gulf Keystone Petroleum's interest expense (positive number) was kr19.918 Mil. Its total Book Value of Debt (D) is kr15.257 Mil.
Cost of Debt = 19.918 / 15.257 = 130.5499%.
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 = -4.716 / 148.639 = -3.17%, which is less than 0%. Therefore it's set to 0%.
Gulf Keystone Petroleum'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)
=
0.997
*
10.481%
+
0.003
*
130.5499%
*
(1 - 0%)
=
10.84%
* 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.
Gulf Keystone Petroleum (OSL:GKP) has a WACC % of 10.84% as of Jul. 01, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Gulf Keystone Petroleum and its competitors. This is near median its historical median of 11.08. Over the past decade, Gulf Keystone Petroleum's WACC % has ranged from 7.97 to 15.86. According to the industry distribution chart, Gulf Keystone Petroleum ranks #878 out of 1039 companies in the Oil & Gas industry, placing it in the top 84.5%.
Is Gulf Keystone Petroleum's WACC % too high?
Gulf Keystone Petroleum's current WACC % of 10.84% is near median its 10-year median of 11.08. Over the past 10 years, this metric has ranged from a low of 7.97 to a high of 15.86. The Oil & Gas industry median WACC % is 7.34. Gulf Keystone Petroleum's value of 10.84% is 47.7% above this industry median. Based on the distribution chart, Gulf Keystone Petroleum ranks #878 out of 1039 companies in the Oil & Gas industry, which is in the bottom quartile relative to peers. Overall, Gulf Keystone Petroleum has a GF Score™ of 62/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Gulf Keystone Petroleum's WACC % compare to COP and EOG?
According to the Oil & Gas industry distribution chart, Gulf Keystone Petroleum ranks #878 out of 1039 companies for WACC %. This places Gulf Keystone Petroleum in the lower half of its industry. The industry median WACC % is 7.34. Gulf Keystone Petroleum's value of 10.84% is 47.7% above this benchmark. Historically, Gulf Keystone Petroleum's own WACC % has ranged from 7.97 to 15.86 over the past decade. While the company's 10-year median is 11.08 vs. the industry median of 7.34, Gulf Keystone Petroleum 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 an Oil & Gas company?
The median WACC % among Oil & Gas companies is 7.34, based on 1,039 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. Gulf Keystone Petroleum's current WACC % of 10.84% is 47.7% 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 Gulf Keystone Petroleum and its competitors. For the Oil & Gas industry, the median WACC % is 7.34 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Gulf Keystone Petroleum's current WACC % is 10.84%, which is near median its own 10-year median of 11.08. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Gulf Keystone Petroleum stock overvalued right now?
Based on GuruFocus' analysis, Gulf Keystone Petroleum (OSL:GKP) is currently considered Fairly Valued. The stock's GF Value™ is kr21.29, compared to a current price of kr22.85 — trading 7.3% above its estimated fair value. The current WACC % is 10.84%, which is near median its 10-year median of 11.08 and 47.7% above the Oil & Gas industry median of 7.34. Gulf Keystone Petroleum's overall GF Score™ is 62/100 with 6 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 Gulf Keystone Petroleum (OSL:GKP), the current WACC % is 10.84% as of Jul. 01, 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 Gulf Keystone Petroleum (OSL:GKP) Overvalued in 2026?
Based on GuruFocus' analysis, Gulf Keystone Petroleum stock appears to be overvalued.
The current stock price of kr22.85 is trading 7.3% above its estimated GF Value™ of kr21.29.
GuruFocus considers Gulf Keystone Petroleum to be Fairly Valued.
Key valuation signals for OSL:GKP:
WACC %: 10.84% (near median its 10-year median of 11.08)
GF Value™: kr21.29 vs. price of kr22.85 (7.3% above fair value)
Industry Position: 47.7% above the Oil & Gas median (#878 of 1039)
No single metric tells the full story. See the OSL:GKP stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Gulf Keystone Petroleum Ltd is a holding company that is engaged in the oil and gas exploration, development, and production business. The company mainly operates in the Kurdistan Region of Iraq, which consists of the Shaikan and the Erbil office, which provide support to the operations in Kurdistan. The firm has a Production Sharing Contract with the Kurdistan Regional Government. The company generates revenue from oil sales.
62GF Score
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