3024.TW
Action Electronics Co Ltd
Price:  
13.25 
TWD
Volume:  
337,301
Taiwan, Province of China | Household Durables

3024.TW WACC - Weighted Average Cost of Capital

The WACC of Action Electronics Co Ltd (3024.TW) is 7.1%.

The Cost of Equity of Action Electronics Co Ltd (3024.TW) is 7.95%.
The Cost of Debt of Action Electronics Co Ltd (3024.TW) is 4.25%.

RangeSelected
Cost of equity6.6% - 9.3%7.95%
Tax rate28.3% - 37.3%32.8%
Cost of debt4.0% - 4.5%4.25%
WACC6.0% - 8.2%7.1%
WACC

3024.TW WACC calculation

CategoryLowHigh
Long-term bond rate2.0%2.5%
Equity market risk premium6.0%7.0%
Adjusted beta0.760.89
Additional risk adjustments0.0%0.5%
Cost of equity6.6%9.3%
Tax rate28.3%37.3%
Debt/Equity ratio
0.190.19
Cost of debt4.0%4.5%
After-tax WACC6.0%8.2%
Selected WACC7.1%

3024.TW'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 3024.TW:

cost_of_equity (7.95%) = risk_free_rate (2.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.76) + 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.