The WACC of Enterex International Ltd (1592.TW) is 6.0%.
| Range | Selected | |
| Cost of equity | 12.30% - 19.60% | 15.95% |
| Tax rate | 17.70% - 21.70% | 19.70% |
| Cost of debt | 4.80% - 7.00% | 5.90% |
| WACC | 4.9% - 7.1% | 6.0% |
| Category | Low | High |
| Long-term bond rate | 1.8% | 2.3% |
| Equity market risk premium | 5.3% | 6.3% |
| Adjusted beta | 1.96 | 2.65 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 12.30% | 19.60% |
| Tax rate | 17.70% | 21.70% |
| Debt/Equity ratio | 7.49 | 7.49 |
| Cost of debt | 4.80% | 7.00% |
| After-tax WACC | 4.9% | 7.1% |
| Selected WACC | 6.0% | |
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 1592.TW:
cost_of_equity (15.95%) = risk_free_rate (2.05%) + equity_risk_premium (5.80%) * adjusted_beta (1.96) + 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.