7050.T WACC - Weighted Average Cost of Capital
The WACC of Frontier International Inc (7050.T) is 7.1%.
| Range | Selected | |
| Cost of equity | 5.5% - 9.1% | 7.3% |
| Tax rate | 34.4% - 37.1% | 35.75% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 5.4% - 8.9% | 7.1% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.67 | 0.95 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.5% | 9.1% |
| Tax rate | 34.4% | 37.1% |
| Debt/Equity ratio | 0.04 | 0.04 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 5.4% | 8.9% |
| Selected WACC | 7.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 7050.T | Frontier International Inc | 0.04 | 0.41 | 0.4 |
| 2180.T | Sunny Side Up Group Inc | 0.13 | 0.57 | 0.53 |
| 2411.T | Gendai Agency Inc | 0.14 | 0.32 | 0.29 |
| 2487.T | CDG Co Ltd | 0 | 0.3 | 0.3 |
| 3675.T | Cross Marketing Group Inc | 0.36 | 1.45 | 1.17 |
| 6045.T | Rentracks Co Ltd | 0.46 | 1.19 | 0.91 |
| 6081.T | Allied Architects Inc | 0.12 | 1.33 | 1.23 |
| 6553.T | SoldOut Inc | 0.05 | 1.26 | 1.22 |
| 7095.T | Macbee Planet Inc | 0.07 | 0.92 | 0.88 |
| 9466.T | Aidma Marketing Communication Corp | 0.13 | 0.49 | 0.45 |
| Low | High | |
| Unlevered beta | 0.5 | 0.89 |
| Relevered beta | 0.51 | 0.93 |
| Adjusted relevered beta | 0.67 | 0.95 |
7050.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 7050.T:
cost_of_equity (7.30%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.67) + 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.