8363.T
Hokkoku Bank Ltd
Price:  
3,310 
JPY
Volume:  
102,600
Japan | Banks

8363.T WACC - Weighted Average Cost of Capital

The WACC of Hokkoku Bank Ltd (8363.T) is 3.7%.

The Cost of Equity of Hokkoku Bank Ltd (8363.T) is 10.75%.
The Cost of Debt of Hokkoku Bank Ltd (8363.T) is 5%.

RangeSelected
Cost of equity6.0% - 15.5%10.75%
Tax rate33.2% - 35.1%34.15%
Cost of debt5.0% - 5.0%5%
WACC3.5% - 3.9%3.7%
WACC

8363.T WACC calculation

CategoryLowHigh
Long-term bond rate0.8%1.2%
Equity market risk premium5.4%6.4%
Adjusted beta0.972.13
Additional risk adjustments0.0%0.5%
Cost of equity6.0%15.5%
Tax rate33.2%35.1%
Debt/Equity ratio
18.1918.19
Cost of debt5.0%5.0%
After-tax WACC3.5%3.9%
Selected WACC3.7%

8363.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 8363.T:

cost_of_equity (10.75%) = risk_free_rate (1.00%) + equity_risk_premium (5.90%) * adjusted_beta (0.97) + 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.