8018.T WACC - Weighted Average Cost of Capital
The WACC of Sankyo Seiko Co Ltd (8018.T) is 5.3%.
| Range | Selected | |
| Cost of equity | 4.4% - 7.0% | 5.7% |
| Tax rate | 23.9% - 24.8% | 24.35% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.2% - 6.4% | 5.3% |
| Category | Low | High |
| Long-term bond rate | 1.4% | 1.9% |
| Equity market risk premium | 6.1% | 7.1% |
| Adjusted beta | 0.5 | 0.65 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 4.4% | 7.0% |
| Tax rate | 23.9% | 24.8% |
| Debt/Equity ratio | 0.2 | 0.2 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.2% | 6.4% |
| Selected WACC | 5.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| 8018.T | Sankyo Seiko Co Ltd | 0.2 | 1.22 | 1.06 |
| 3205.T | Daidoh Ltd | 0.47 | 0.78 | 0.58 |
| 3529.T | Atsugi Co Ltd | 0.05 | 0.45 | 0.43 |
| 3598.T | Yamaki Co Ltd | 1.74 | 0.36 | 0.16 |
| 7769.T | Rhythm Co Ltd | 0.3 | 0.31 | 0.25 |
| 7829.T | Samantha Thavasa Japan Ltd | 4.35 | -0.07 | -0.02 |
| 7872.T | Estelle Holdings Co Ltd | 1.46 | 0.17 | 0.08 |
| 8127.T | Yamato International Inc | 0.1 | 0.54 | 0.5 |
| 8139.T | Nagahori Corp | 0.39 | 0.11 | 0.08 |
| 9275.T | Narumiya International Co Ltd | 0.15 | 0.44 | 0.39 |
| Low | High | |
| Unlevered beta | 0.21 | 0.41 |
| Relevered beta | 0.25 | 0.48 |
| Adjusted relevered beta | 0.5 | 0.65 |
8018.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 8018.T:
cost_of_equity (5.70%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (0.5) + 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.