3011.T WACC - Weighted Average Cost of Capital

The WACC of Banners Co Ltd (3011.T) is 5.1%.

The Cost of Equity of Banners Co Ltd (3011.T) is 6.85%.

The Cost of Debt of Banners Co Ltd (3011.T) is 4.25%.

	Range	Selected
Cost of equity	5.90% - 7.80%	6.85%
Tax rate	14.40% - 18.60%	16.50%
Cost of debt	4.00% - 4.50%	4.25%
WACC	4.6% - 5.6%	5.1%

WACC

3011.T WACC calculation

Category	Low	High

Long-term bond rate	1.4%	1.9%
Equity market risk premium	6.1%	7.1%
Adjusted beta	0.73	0.76

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.90%	7.80%

Tax rate	14.40%	18.60%
Debt/Equity ratio	1.1	1.1
Cost of debt	4.00%	4.50%

After-tax WACC	4.6%	5.6%


Selected WACC	5.1%

3011.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 3011.T:

cost_of_equity (6.85%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.73) + 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.