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As of today (2026-07-27), Emaar the Economic City JSC's weighted average cost of capital is 9.91%%. Emaar the Economic City JSC's ROIC % is 0.05% (calculated using TTM income statement data).
Emaar the Economic City JSC 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.
Emaar the Economic City JSC (SAU:4220) 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, Emaar the Economic City JSC's weighted average cost of capital is 9.91%%. Emaar the Economic City JSC's ROIC % is 0.05% (calculated using TTM income statement data).
Emaar the Economic City JSC 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 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
Emaar the Economic City JSC WACC % Historical Data
* 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.
Emaar the Economic City JSC WACC % Competitor Comparison
For the Real Estate - Development subindustry, Emaar the Economic City JSC'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.
Emaar the Economic City JSC WACC % vs Real Estate Industry
For the Real Estate industry and Real Estate sector, Emaar the Economic City JSC's WACC % distribution charts can be found below:
* The bar in red indicates where Emaar the Economic City JSC'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, Emaar the Economic City JSC's market capitalization (E) is ﷼8608.567 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, Emaar the Economic City JSC's latest one-year quarterly average Book Value of Debt (D) is ﷼6945.9814 Mil.
a) weight of equity = E / (E + D) = 8608.567 / (8608.567 + 6945.9814) = 0.5534
b) weight of debt = D / (E + D) = 6945.9814 / (8608.567 + 6945.9814) = 0.4466
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 4.647%. 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. Emaar the Economic City JSC's beta is 1.3022.
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 = 4.647% + 1.3022 * 6% = 12.4602%
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, Emaar the Economic City JSC's interest expense (positive number) was ﷼468.984 Mil. Its total Book Value of Debt (D) is ﷼6945.9814 Mil.
Cost of Debt = 468.984 / 6945.9814 = 6.7519%.
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 = 23.688 / -42.329 = -55.96%, which is less than 0%. Therefore it's set to 0%.
* 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.
Emaar the Economic City JSC (SAU:4220) has a WACC % of 9.91% as of Jul. 27, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Emaar the Economic City JSC and its competitors. This is 58% above median its historical median of 6.28. Over the past decade, Emaar the Economic City JSC's WACC % has ranged from 3.84 to 9.94. According to the industry distribution chart, Emaar the Economic City JSC ranks #1362 out of 1843 companies in the Real Estate industry, placing it in the top 73.9%.
Is Emaar the Economic City JSC's WACC % too high?
Emaar the Economic City JSC's current WACC % of 9.91% is 58% above median its 10-year median of 6.28. Over the past 10 years, this metric has ranged from a low of 3.84 to a high of 9.94. The Real Estate industry median WACC % is 6.49. Emaar the Economic City JSC's value of 9.91% is 52.7% above this industry median. Based on the distribution chart, Emaar the Economic City JSC ranks #1362 out of 1843 companies in the Real Estate industry, which is below the industry midpoint. Overall, Emaar the Economic City JSC has a GF Score™ of 59/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Emaar the Economic City JSC's WACC % compare to competitors?
According to the Real Estate industry distribution chart, Emaar the Economic City JSC ranks #1362 out of 1843 companies for WACC %. This places Emaar the Economic City JSC in the lower half of its industry. The industry median WACC % is 6.49. Emaar the Economic City JSC's value of 9.91% is 52.7% above this benchmark. Historically, Emaar the Economic City JSC's own WACC % has ranged from 3.84 to 9.94 over the past decade. While the company's 10-year median is 6.28 vs. the industry median of 6.49, Emaar the Economic City JSC 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 Real Estate company?
The median WACC % among Real Estate companies is 6.49, based on 1,843 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. Emaar the Economic City JSC's current WACC % of 9.91% is 52.7% 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 Emaar the Economic City JSC and its competitors. For the Real Estate industry, the median WACC % is 6.49 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Emaar the Economic City JSC's current WACC % is 9.91%, which is 58% above median its own 10-year median of 6.28. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Emaar the Economic City JSC stock overvalued right now?
Based on GuruFocus' analysis, Emaar the Economic City JSC (SAU:4220) is currently considered Possible Value Trap. The stock's GF Value™ is ﷼22.65, compared to a current price of ﷼9.75 — trading 57% below its estimated fair value. The current WACC % is 9.91%, which is 58% above median its 10-year median of 6.28 and 52.7% above the Real Estate industry median of 6.49. Emaar the Economic City JSC's overall GF Score™ is 59/100 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 Emaar the Economic City JSC (SAU:4220), the current WACC % is 9.91% as of Jul. 27, 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 Emaar the Economic City JSC (SAU:4220) Overvalued in 2026?
Based on GuruFocus' analysis, Emaar the Economic City JSC stock appears to be undervalued.
The current stock price of ﷼9.75 is trading 57% below its estimated GF Value™ of ﷼22.65.
GuruFocus considers Emaar the Economic City JSC to be Possible Value Trap.
Key valuation signals for SAU:4220:
WACC %: 9.91% (58% above median its 10-year median of 6.28)
GF Value™: ﷼22.65 vs. price of ﷼9.75 (57% below fair value)
Industry Position: 52.7% above the Real Estate median (#1362 of 1843)
No single metric tells the full story. See the SAU:4220 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Emaar the Economic City JSC is a real estate development and management company. The main activity of the company is the development of the King Abdullah Economic City (KAEC). It is also engaged in the development of real estate in the economic and other zones and other development activities, including infrastructures, promotion, marketing and sale of land within development areas, development of buildings and housing units, and construction on behalf of other parties. The company's reportable segments includes Residential business, Industrial development, Hospitality and leisure, Education services, and City operations. Key revenue is derived from its Residential business segment which includes revenue from sale/lease rental income of land and units for residential purposes.
59GF Score
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