3110.T WACC - Weighted Average Cost of Capital
The WACC of Nitto Boseki Co Ltd (3110.T) is 5.9%.
| Range | Selected | |
| Cost of equity | 5.7% - 8.2% | 6.95% |
| Tax rate | 24.1% - 25.4% | 24.75% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 5.0% - 6.9% | 5.9% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.7 | 0.81 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.7% | 8.2% |
| Tax rate | 24.1% | 25.4% |
| Debt/Equity ratio | 0.35 | 0.35 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 5.0% | 6.9% |
| Selected WACC | 5.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 3110.T | Nitto Boseki Co Ltd | 0.35 | 0.98 | 0.77 |
| 4212.T | Sekisui Jushi Corp | 0.23 | 0.62 | 0.53 |
| 5940.T | Fujisash Co Ltd | 2.81 | 0.85 | 0.27 |
| 5959.T | Okabe Co Ltd | 0.16 | 0.6 | 0.54 |
| 6458.T | Sinko Industries Ltd | 0.03 | 0.73 | 0.72 |
| 7438.T | Kondotec Inc | 0.15 | 0.68 | 0.61 |
| 7821.T | Maeda Kosen Co Ltd | 0.03 | 0.71 | 0.69 |
| 7822.T | Eidai Co Ltd | 2.42 | 0.52 | 0.18 |
| 7879.T | Noda Corp | 0.9 | 0.48 | 0.29 |
| 7943.T | Nichiha Corp | 0.14 | 0.3 | 0.27 |
| Low | High | |
| Unlevered beta | 0.43 | 0.57 |
| Relevered beta | 0.55 | 0.72 |
| Adjusted relevered beta | 0.7 | 0.81 |
3110.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 3110.T:
cost_of_equity (6.95%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.7) + 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.