6471.T WACC - Weighted Average Cost of Capital
The WACC of NSK Ltd (6471.T) is 5.6%.
| Range | Selected | |
| Cost of equity | 7.1% - 10.2% | 8.65% |
| Tax rate | 43.4% - 46.5% | 44.95% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.8% - 6.4% | 5.6% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.93 | 1.09 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.1% | 10.2% |
| Tax rate | 43.4% | 46.5% |
| Debt/Equity ratio | 0.93 | 0.93 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.8% | 6.4% |
| Selected WACC | 5.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 6471.T | NSK Ltd | 0.93 | 0.91 | 0.61 |
| 5333.T | NGK Insulators Ltd | 0.47 | 1.06 | 0.85 |
| 6005.T | Miura Co Ltd | 0.36 | 0.63 | 0.53 |
| 6302.T | Sumitomo Heavy Industries Ltd | 0.66 | 1.13 | 0.83 |
| 6361.T | Ebara Corp | 0.12 | 1.66 | 1.56 |
| 6406.T | Fujitec Co Ltd | 0.01 | 0.57 | 0.57 |
| 6472.T | NTN Corp | 2.82 | 1.09 | 0.43 |
| 6474.T | Nachi-Fujikoshi Corp | 1.23 | 0.9 | 0.54 |
| 6479.T | Minebea Mitsumi Inc | 0.5 | 1.35 | 1.06 |
| 7004.T | Hitachi Zosen Corp | 0.81 | 1.01 | 0.7 |
| Low | High | |
| Unlevered beta | 0.59 | 0.75 |
| Relevered beta | 0.9 | 1.13 |
| Adjusted relevered beta | 0.93 | 1.09 |
6471.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 6471.T:
cost_of_equity (8.65%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.93) + 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.