COM7.BK WACC - Weighted Average Cost of Capital
The WACC of Com7 PCL (COM7.BK) is 10.2%.
| Range | Selected | |
| Cost of equity | 9.8% - 12.7% | 11.25% |
| Tax rate | 17.5% - 17.9% | 17.7% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 8.9% - 11.4% | 10.2% |
| Category | Low | High |
| Long-term bond rate | 2.6% | 3.1% |
| Equity market risk premium | 7.4% | 8.4% |
| Adjusted beta | 0.98 | 1.08 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.8% | 12.7% |
| Tax rate | 17.5% | 17.9% |
| Debt/Equity ratio | 0.16 | 0.16 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 8.9% | 11.4% |
| Selected WACC | 10.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| COM7.BK | Com7 PCL | 0.16 | 1.33 | 1.18 |
| BIG.BK | BIG Camera Corporation PCL | 0.31 | 1.08 | 0.86 |
| CPW.BK | Copperwired PCL | 0.62 | 0.61 | 0.4 |
| IT.BK | IT City PCL | 1.35 | 0.74 | 0.35 |
| SPVI.BK | SPVI PCL | 0.23 | 1.26 | 1.06 |
| Low | High | |
| Unlevered beta | 0.68 | 0.94 |
| Relevered beta | 0.97 | 1.12 |
| Adjusted relevered beta | 0.98 | 1.08 |
COM7.BK'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 COM7.BK:
cost_of_equity (11.25%) = risk_free_rate (2.85%) + equity_risk_premium (7.90%) * adjusted_beta (0.98) + 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.