3955.T WACC - Weighted Average Cost of Capital
The WACC of Imura Envelope Co Inc (3955.T) is 7.1%.
| Range | Selected | |
| Cost of equity | 6.5% - 9.1% | 7.8% |
| Tax rate | 31.7% - 32.3% | 32% |
| Cost of debt | 4.0% - 6.5% | 5.25% |
| WACC | 5.8% - 8.3% | 7.1% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.83 | 0.94 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.5% | 9.1% |
| Tax rate | 31.7% | 32.3% |
| Debt/Equity ratio | 0.21 | 0.21 |
| Cost of debt | 4.0% | 6.5% |
| After-tax WACC | 5.8% | 8.3% |
| Selected WACC | 7.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 3955.T | Imura Envelope Co Inc | 0.21 | 0.5 | 0.44 |
| 4987.T | Teraoka Seisakusho Co Ltd | 0.06 | 0.81 | 0.77 |
| 5695.T | Powdertech Co Ltd | 0 | 0.31 | 0.31 |
| 7885.T | Takano Co Ltd | 0.03 | 0.48 | 0.47 |
| 7959.T | Oliver Corp | 0.02 | 1.07 | 1.06 |
| 7972.T | Itoki Corp | 0.38 | 1.21 | 0.96 |
| 7976.T | Mitsubishi Pencil Co Ltd | 0.09 | 0.93 | 0.88 |
| 7980.T | Shigematsu Works Co Ltd | 0.91 | 0.41 | 0.25 |
| 7984.T | Kokuyo Co Ltd | 0.04 | 0.84 | 0.82 |
| 7994.T | Okamura Corp | 0.16 | 0.84 | 0.75 |
| Low | High | |
| Unlevered beta | 0.64 | 0.79 |
| Relevered beta | 0.75 | 0.91 |
| Adjusted relevered beta | 0.83 | 0.94 |
3955.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 3955.T:
cost_of_equity (7.80%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.83) + 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.