4725.T
CAC Holdings Corp
Price:  
1,959 
JPY
Volume:  
17,800
Japan | IT Services

4725.T WACC - Weighted Average Cost of Capital

The WACC of CAC Holdings Corp (4725.T) is 7.2%.

The Cost of Equity of CAC Holdings Corp (4725.T) is 7.4%.
The Cost of Debt of CAC Holdings Corp (4725.T) is 4.25%.

RangeSelected
Cost of equity6.2% - 8.6%7.4%
Tax rate34.9% - 36.5%35.7%
Cost of debt4.0% - 4.5%4.25%
WACC6.0% - 8.3%7.2%
WACC

4725.T WACC calculation

CategoryLowHigh
Long-term bond rate1.4%1.9%
Equity market risk premium6.1%7.1%
Adjusted beta0.780.87
Additional risk adjustments0.0%0.5%
Cost of equity6.2%8.6%
Tax rate34.9%36.5%
Debt/Equity ratio
0.050.05
Cost of debt4.0%4.5%
After-tax WACC6.0%8.3%
Selected WACC7.2%

4725.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 4725.T:

cost_of_equity (7.40%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.78) + 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.