7161.T
Jimoto Holdings Inc
Price:  
345.00 
JPY
Volume:  
29,200.00
Japan | Banks
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7161.T WACC - Weighted Average Cost of Capital

The WACC of Jimoto Holdings Inc (7161.T) is 4.7%.

The Cost of Equity of Jimoto Holdings Inc (7161.T) is 13.55%.
The Cost of Debt of Jimoto Holdings Inc (7161.T) is 5.00%.

Range Selected
Cost of equity 10.20% - 16.90% 13.55%
Tax rate 22.30% - 29.30% 25.80%
Cost of debt 5.00% - 5.00% 5.00%
WACC 4.5% - 4.9% 4.7%
WACC

7161.T WACC calculation

Category Low High
Long-term bond rate 1.4% 1.9%
Equity market risk premium 6.1% 7.1%
Adjusted beta 1.43 2.03
Additional risk adjustments 0.0% 0.5%
Cost of equity 10.20% 16.90%
Tax rate 22.30% 29.30%
Debt/Equity ratio 8.96 8.96
Cost of debt 5.00% 5.00%
After-tax WACC 4.5% 4.9%
Selected WACC 4.7%

7161.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 7161.T:

cost_of_equity (13.55%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (1.43) + 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.