The WACC of Bingo Industries Ltd (BIN.AX) is 7.6%.
Range | Selected | |
Cost of equity | 7.2% - 9.4% | 8.3% |
Tax rate | 30.9% - 31.1% | 31% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 6.7% - 8.6% | 7.6% |
Category | Low | High |
Long-term bond rate | 3.7% | 4.2% |
Equity market risk premium | 4.7% | 5.7% |
Adjusted beta | 0.75 | 0.83 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 7.2% | 9.4% |
Tax rate | 30.9% | 31.1% |
Debt/Equity ratio | 0.17 | 0.17 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 6.7% | 8.6% |
Selected WACC | 7.6% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
BIN.AX | Bingo Industries Ltd | 0.17 | 1.23 | 1.1 |
1AG.AX | Alterra Ltd | 4.37 | 0.9 | 0.22 |
300355.SZ | Inner Mongolia M-Grass Ecology and Environment Group Co Ltd | 0.94 | 0.99 | 0.6 |
3718.HK | Beijing Enterprises Urban Resources Group Ltd | 2.27 | 0.25 | 0.1 |
601330.SS | Dynagreen Environmental Protection Group Co Ltd | 1.18 | 0.88 | 0.49 |
601827.SS | Chongqing Sanfeng Environment Group Corp Ltd | 0.53 | 0.59 | 0.43 |
9793.T | Daiseki Co Ltd | 0.03 | 0.6 | 0.59 |
AEI.AX | Aeris Environmental Ltd | 0.09 | 0.59 | 0.55 |
CWY.AX | Cleanaway Waste Management Ltd | 0.29 | 0.56 | 0.47 |
M8S.AX | M8 Sustainable Ltd | 2.79 | 3.55 | 1.21 |
Low | High | |
Unlevered beta | 0.48 | 0.57 |
Relevered beta | 0.63 | 0.75 |
Adjusted relevered beta | 0.75 | 0.83 |
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 BIN.AX:
cost_of_equity (8.30%) = risk_free_rate (3.95%) + equity_risk_premium (5.20%) * adjusted_beta (0.75) + 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.