5121.T
Fujikura Composites Inc.
Price:  
1,474 
JPY
Volume:  
41,000
Japan | Auto Components

5121.T WACC - Weighted Average Cost of Capital

The WACC of Fujikura Composites Inc. (5121.T) is 8.0%.

The Cost of Equity of Fujikura Composites Inc. (5121.T) is 8.55%.
The Cost of Debt of Fujikura Composites Inc. (5121.T) is 4.25%.

RangeSelected
Cost of equity7.5% - 9.6%8.55%
Tax rate21.2% - 21.8%21.5%
Cost of debt4.0% - 4.5%4.25%
WACC7.1% - 9.0%8.0%
WACC

5121.T WACC calculation

CategoryLowHigh
Long-term bond rate1.4%1.9%
Equity market risk premium6.1%7.1%
Adjusted beta11.02
Additional risk adjustments0.0%0.5%
Cost of equity7.5%9.6%
Tax rate21.2%21.8%
Debt/Equity ratio
0.120.12
Cost of debt4.0%4.5%
After-tax WACC7.1%9.0%
Selected WACC8.0%

5121.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 5121.T:

cost_of_equity (8.55%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (1) + 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.