8544.T
Keiyo Bank Ltd
Price:  
1,066.00 
JPY
Volume:  
352,300.00
Japan | Banks
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8544.T WACC - Weighted Average Cost of Capital

The WACC of Keiyo Bank Ltd (8544.T) is 4.8%.

The Cost of Equity of Keiyo Bank Ltd (8544.T) is 10.90%.
The Cost of Debt of Keiyo Bank Ltd (8544.T) is 5.00%.

Range Selected
Cost of equity 8.70% - 13.10% 10.90%
Tax rate 29.70% - 29.70% 29.70%
Cost of debt 5.00% - 5.00% 5.00%
WACC 4.4% - 5.1% 4.8%
WACC

8544.T WACC calculation

Category Low High
Long-term bond rate 1.4% 1.9%
Equity market risk premium 6.1% 7.1%
Adjusted beta 1.19 1.5
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.70% 13.10%
Tax rate 29.70% 29.70%
Debt/Equity ratio 4.92 4.92
Cost of debt 5.00% 5.00%
After-tax WACC 4.4% 5.1%
Selected WACC 4.8%

8544.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 8544.T:

cost_of_equity (10.90%) = risk_free_rate (1.65%) + equity_risk_premium (6.60%) * adjusted_beta (1.19) + 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.