300654.SZ WACC - Weighted Average Cost of Capital

The WACC of Astro-century Education & Technology Co Ltd (300654.SZ) is 8.4%.

The Cost of Equity of Astro-century Education & Technology Co Ltd (300654.SZ) is 8.40%.

The Cost of Debt of Astro-century Education & Technology Co Ltd (300654.SZ) is 5.00%.

	Range	Selected
Cost of equity	6.10% - 10.70%	8.40%
Tax rate	27.10% - 27.50%	27.30%
Cost of debt	5.00% - 5.00%	5.00%
WACC	6.1% - 10.6%	8.4%

WACC

300654.SZ WACC calculation

Category	Low	High

Long-term bond rate	2.7%	3.2%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.55	0.98

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.10%	10.70%

Tax rate	27.10%	27.50%
Debt/Equity ratio	0	0
Cost of debt	5.00%	5.00%

After-tax WACC	6.1%	10.6%


Selected WACC	8.4%

300654.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 300654.SZ:

cost_of_equity (8.40%) = risk_free_rate (2.95%) + equity_risk_premium (6.60%) * adjusted_beta (0.55) + 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.