AMA.AX WACC - Weighted Average Cost of Capital
The WACC of AMA Group Ltd (AMA.AX) is 6.1%.
| Range | Selected | |
| Cost of equity | 6.4% - 8.9% | 7.65% |
| Tax rate | 8.0% - 12.7% | 10.35% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 4.8% - 7.3% | 6.1% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.46 | 0.64 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.4% | 8.9% |
| Tax rate | 8.0% | 12.7% |
| Debt/Equity ratio | 1.31 | 1.31 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 4.8% | 7.3% |
| Selected WACC | 6.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| AMA.AX | AMA Group Ltd | 1.31 | 1.08 | 0.49 |
| 051600.KS | KEPCO Plant Service & Engineering Co Ltd | 0.01 | 0.03 | 0.03 |
| 2438.T | Asukanet Co Ltd | 0 | 0.81 | 0.81 |
| 3286.T | Trust Holdings Inc | 1.3 | 0.12 | 0.05 |
| 6086.T | Shin Maint Holdings Co Ltd | 0.02 | 0.28 | 0.28 |
| 7502.T | Plaza Create Honsha Co Ltd | 3.73 | 0.08 | 0.02 |
| 8283.HK | Zheng LI Holdings Ltd | 0.79 | 0.29 | 0.17 |
| MAD.AX | Mader Group Ltd | 0.05 | 0.77 | 0.73 |
| MIL.AX | Millennium Services Group Ltd | 0.18 | 0.09 | 0.07 |
| SGF.AX | SG Fleet Group Ltd | 1.66 | 0.25 | 0.1 |
| Low | High | |
| Unlevered beta | 0.09 | 0.21 |
| Relevered beta | 0.19 | 0.46 |
| Adjusted relevered beta | 0.46 | 0.64 |
AMA.AX'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 AMA.AX:
cost_of_equity (7.65%) = risk_free_rate (4.25%) + equity_risk_premium (5.60%) * adjusted_beta (0.46) + 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.