The WACC of Aeon Thana Sinsap Thailand PCL (AEONTS.BK) is 6.5%.
Range | Selected | |
Cost of equity | 10.20% - 15.40% | 12.80% |
Tax rate | 20.50% - 21.20% | 20.85% |
Cost of debt | 4.00% - 4.80% | 4.40% |
WACC | 5.5% - 7.5% | 6.5% |
Category | Low | High |
Long-term bond rate | 2.6% | 3.1% |
Equity market risk premium | 7.4% | 8.4% |
Adjusted beta | 1.02 | 1.41 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 10.20% | 15.40% |
Tax rate | 20.50% | 21.20% |
Debt/Equity ratio | 2.07 | 2.07 |
Cost of debt | 4.00% | 4.80% |
After-tax WACC | 5.5% | 7.5% |
Selected WACC | 6.5% | |
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 AEONTS.BK:
cost_of_equity (12.80%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (1.02) + 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.