ASH.AX
Ashley Services Group Ltd
Price:  
0.19 
AUD
Volume:  
51,732
Australia | Professional Services

ASH.AX WACC - Weighted Average Cost of Capital

The WACC of Ashley Services Group Ltd (ASH.AX) is 5.8%.

The Cost of Equity of Ashley Services Group Ltd (ASH.AX) is 6.9%.
The Cost of Debt of Ashley Services Group Ltd (ASH.AX) is 5.5%.

RangeSelected
Cost of equity6.0% - 7.8%6.9%
Tax rate28.5% - 29.4%28.95%
Cost of debt4.0% - 7.0%5.5%
WACC4.8% - 6.8%5.8%
WACC

ASH.AX WACC calculation

CategoryLowHigh
Long-term bond rate4.0%4.5%
Equity market risk premium5.1%6.1%
Adjusted beta0.380.46
Additional risk adjustments0.0%0.5%
Cost of equity6.0%7.8%
Tax rate28.5%29.4%
Debt/Equity ratio
0.590.59
Cost of debt4.0%7.0%
After-tax WACC4.8%6.8%
Selected WACC5.8%

ASH.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 ASH.AX:

cost_of_equity (6.90%) = risk_free_rate (4.25%) + equity_risk_premium (5.60%) * adjusted_beta (0.38) + 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.