6622.T WACC - Weighted Average Cost of Capital
The WACC of Daihen Corp (6622.T) is 7.3%.
| Range | Selected | |
| Cost of equity | 6.7% - 11.3% | 9% |
| Tax rate | 25.9% - 26.9% | 26.4% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 5.6% - 8.9% | 7.3% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.87 | 1.25 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.7% | 11.3% |
| Tax rate | 25.9% | 26.9% |
| Debt/Equity ratio | 0.41 | 0.41 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 5.6% | 8.9% |
| Selected WACC | 7.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 6622.T | Daihen Corp | 0.41 | 1.38 | 1.06 |
| 3856.T | Abalance Corp | 4.56 | 1.65 | 0.38 |
| 6503.T | Mitsubishi Electric Corp | 0.06 | 1.48 | 1.42 |
| 6505.T | Toyo Denki Seizo KK | 0.76 | 0.9 | 0.57 |
| 6507.T | Sinfonia Technology Co Ltd | 0.05 | 1.76 | 1.69 |
| 6641.T | Nissin Electric Co Ltd | 0.01 | 1.32 | 1.31 |
| 6648.T | Kawaden Corp | 0.08 | 0.35 | 0.33 |
| 6651.T | Nitto Kogyo Corp | 0.22 | 0.72 | 0.62 |
| 6653.T | Seiko Electric Co Ltd | 0.15 | 1.16 | 1.05 |
| 6925.T | Ushio Inc | 0.25 | 0.72 | 0.61 |
| Low | High | |
| Unlevered beta | 0.62 | 1.05 |
| Relevered beta | 0.81 | 1.37 |
| Adjusted relevered beta | 0.87 | 1.25 |
6622.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 6622.T:
cost_of_equity (9.00%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.87) + 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.