6616.T
Torex Semiconductor Ltd
Price:  
1,365.00 
JPY
Volume:  
23,500.00
Japan | Semiconductors & Semiconductor Equipment
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6616.T WACC - Weighted Average Cost of Capital

The WACC of Torex Semiconductor Ltd (6616.T) is 6.9%.

The Cost of Equity of Torex Semiconductor Ltd (6616.T) is 9.15%.
The Cost of Debt of Torex Semiconductor Ltd (6616.T) is 5.50%.

Range Selected
Cost of equity 6.00% - 12.30% 9.15%
Tax rate 22.10% - 24.80% 23.45%
Cost of debt 4.00% - 7.00% 5.50%
WACC 4.7% - 9.1% 6.9%
WACC

6616.T WACC calculation

Category Low High
Long-term bond rate 1.4% 1.9%
Equity market risk premium 6.1% 7.1%
Adjusted beta 0.75 1.39
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.00% 12.30%
Tax rate 22.10% 24.80%
Debt/Equity ratio 0.83 0.83
Cost of debt 4.00% 7.00%
After-tax WACC 4.7% 9.1%
Selected WACC 6.9%

6616.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 6616.T:

cost_of_equity (9.15%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.75) + 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.