002722.SZ WACC - Weighted Average Cost of Capital
The WACC of Geron Co Ltd (002722.SZ) is 9.0%.
| Range | Selected | |
| Cost of equity | 8.2% - 11.4% | 9.8% |
| Tax rate | 21.6% - 23.9% | 22.75% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.6% - 10.3% | 9.0% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.91 | 1.08 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.2% | 11.4% |
| Tax rate | 21.6% | 23.9% |
| Debt/Equity ratio | 0.17 | 0.17 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.6% | 10.3% |
| Selected WACC | 9.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 002722.SZ | Geron Co Ltd | 0.19 | 1.38 | 1.2 |
| 000570.SZ | Changchai Co Ltd | 0.2 | 0.99 | 0.86 |
| 000856.SZ | Tangshan Jidong Equipment and Engineering Co Ltd | 0.14 | 1.24 | 1.12 |
| 002786.SZ | Shenzhen Silver Basis Technology Co Ltd | 0.23 | 0.85 | 0.72 |
| 002855.SZ | Dongguan Chitwing Technology Co Ltd | 0.18 | 1.93 | 1.69 |
| 200706.SZ | Wafangdian Bearing Co Ltd | 1.18 | 0.08 | 0.04 |
| 2060.HK | Pujiang International Group Ltd | 15.33 | 0.21 | 0.02 |
| 2283.HK | TK Group Holdings Ltd | 0.06 | 0.45 | 0.43 |
| 300140.SZ | Cecep Environmental Protection Equipment Co Ltd | 0.64 | 1.92 | 1.28 |
| 600558.SS | Atlantic China Welding Consumables Inc | 0.03 | 0.93 | 0.91 |
| Low | High | |
| Unlevered beta | 0.8 | 0.99 |
| Relevered beta | 0.87 | 1.12 |
| Adjusted relevered beta | 0.91 | 1.08 |
002722.SZ's CAPM model and how its cost of Equity is calculated
The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.
This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.
Here’s how we figure out the cost of equity for 002722.SZ:
cost_of_equity (9.80%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.91) + risk_adjustments (0.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.