6417.T
Sankyo Co Ltd
Price:  
2,481.5 
JPY
Volume:  
1,689,100
Japan | Leisure Products

6417.T WACC - Weighted Average Cost of Capital

The WACC of Sankyo Co Ltd (6417.T) is 7.5%.

The Cost of Equity of Sankyo Co Ltd (6417.T) is 11.45%.
The Cost of Debt of Sankyo Co Ltd (6417.T) is 5%.

RangeSelected
Cost of equity9.6% - 13.3%11.45%
Tax rate26.8% - 28.0%27.4%
Cost of debt5.0% - 5.0%5%
WACC6.6% - 8.4%7.5%
WACC

6417.T WACC calculation

CategoryLowHigh
Long-term bond rate1.4%1.9%
Equity market risk premium6.1%7.1%
Adjusted beta1.341.53
Additional risk adjustments0.0%0.5%
Cost of equity9.6%13.3%
Tax rate26.8%28.0%
Debt/Equity ratio
11
Cost of debt5.0%5.0%
After-tax WACC6.6%8.4%
Selected WACC7.5%

6417.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 6417.T:

cost_of_equity (11.45%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (1.34) + 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.