The WACC of Lelon Electronics Corp (2472.TW) is 9.3%.
Range | Selected | |
Cost of equity | 8.5% - 12.4% | 10.45% |
Tax rate | 21.6% - 22.1% | 21.85% |
Cost of debt | 4.0% - 4.5% | 4.25% |
WACC | 7.6% - 10.9% | 9.3% |
Category | Low | High |
Long-term bond rate | 2.0% | 2.5% |
Equity market risk premium | 6.0% | 7.0% |
Adjusted beta | 1.08 | 1.33 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 8.5% | 12.4% |
Tax rate | 21.6% | 22.1% |
Debt/Equity ratio | 0.2 | 0.2 |
Cost of debt | 4.0% | 4.5% |
After-tax WACC | 7.6% | 10.9% |
Selected WACC | 9.3% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
2472.TW | Lelon Electronics Corp | 0.2 | 1.28 | 1.11 |
2402.TW | Ichia Technologies Inc | 0.26 | 0.93 | 0.77 |
2478.TW | TA-I Technology Co Ltd | 0.21 | 0.74 | 0.63 |
2486.TW | I-Chiun Precision Industry Co Ltd | 0.22 | 1.72 | 1.46 |
3605.TW | Aces Electronics Co Ltd | 0.42 | 1.65 | 1.24 |
3694.TW | AzureWave Technologies Inc | 0.02 | 1.4 | 1.38 |
4943.TW | Concraft Holding Co Ltd | 0.83 | 0.31 | 0.19 |
6230.TW | Nidec Chaun Choung Technology Corp | 0.04 | 1.62 | 1.57 |
6449.TW | APAQ Technology Co Ltd | 0.18 | 1.66 | 1.46 |
8039.TW | Taiflex Scientific Co Ltd | 0.1 | 0.83 | 0.77 |
Low | High | |
Unlevered beta | 0.97 | 1.3 |
Relevered beta | 1.12 | 1.49 |
Adjusted relevered beta | 1.08 | 1.33 |
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 2472.TW:
cost_of_equity (10.45%) = risk_free_rate (2.25%) + equity_risk_premium (6.50%) * adjusted_beta (1.08) + 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.