AUB.AX WACC - Weighted Average Cost of Capital
The WACC of AUB Group Ltd (AUB.AX) is 7.5%.
| Range | Selected | |
| Cost of equity | 7.0% - 9.1% | 8.05% |
| Tax rate | 18.2% - 19.9% | 19.05% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 6.5% - 8.6% | 7.5% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.59 | 0.67 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.0% | 9.1% |
| Tax rate | 18.2% | 19.9% |
| Debt/Equity ratio | 0.18 | 0.18 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 6.5% | 8.6% |
| Selected WACC | 7.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| AUB.AX | AUB Group Ltd | 0.18 | 0.68 | 0.6 |
| 7169.T | NFC Holdings Inc | 0.36 | 0.21 | 0.16 |
| 7325.T | IRRC Corp | 0.02 | 0.52 | 0.51 |
| 8109.HK | Kirin Group Holdings Ltd | 2.94 | 1.71 | 0.5 |
| 8798.T | Advance Create Co Ltd | 0.42 | 0.56 | 0.41 |
| ASN.BK | ASN Broker PCL | 0.96 | 0.52 | 0.29 |
| ENA.AX | Ensurance Ltd | 0 | -0.27 | -0.27 |
| GDG.AX | Generation Development Group Ltd | 0 | 1.3 | 1.29 |
| PSI.AX | PSC Insurance Group Ltd | 0.11 | 0.15 | 0.14 |
| SDF.AX | Steadfast Group Ltd | 0.2 | 0.42 | 0.37 |
| Low | High | |
| Unlevered beta | 0.34 | 0.45 |
| Relevered beta | 0.39 | 0.51 |
| Adjusted relevered beta | 0.59 | 0.67 |
AUB.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 AUB.AX:
cost_of_equity (8.05%) = risk_free_rate (4.25%) + equity_risk_premium (5.60%) * adjusted_beta (0.59) + 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.