2291.T WACC - Weighted Average Cost of Capital

The WACC of Fukutome Meat Packers Ltd (2291.T) is 5.0%.

The Cost of Equity of Fukutome Meat Packers Ltd (2291.T) is 5.25%.

The Cost of Debt of Fukutome Meat Packers Ltd (2291.T) is 5.50%.

	Range	Selected
Cost of equity	4.10% - 6.40%	5.25%
Tax rate	8.50% - 13.50%	11.00%
Cost of debt	4.00% - 7.00%	5.50%
WACC	3.8% - 6.2%	5.0%

WACC

2291.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.45	0.56

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.10%	6.40%

Tax rate	8.50%	13.50%
Debt/Equity ratio	1.71	1.71
Cost of debt	4.00%	7.00%

After-tax WACC	3.8%	6.2%


Selected WACC	5.0%

2291.T'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 2291.T:

cost_of_equity (5.25%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.45) + 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.