ECX.AX
Eclipx Group Ltd
Price:  
2.88 
AUD
Volume:  
483,480
Australia | Consumer Finance

ECX.AX WACC - Weighted Average Cost of Capital

The WACC of Eclipx Group Ltd (ECX.AX) is 6.0%.

The Cost of Equity of Eclipx Group Ltd (ECX.AX) is 9.85%.
The Cost of Debt of Eclipx Group Ltd (ECX.AX) is 5%.

RangeSelected
Cost of equity6.9% - 12.8%9.85%
Tax rate29.2% - 29.5%29.35%
Cost of debt5.0% - 5.0%5%
WACC4.9% - 7.2%6.0%
WACC

ECX.AX WACC calculation

CategoryLowHigh
Long-term bond rate4.1%4.6%
Equity market risk premium5.5%6.5%
Adjusted beta0.511.18
Additional risk adjustments0.0%0.5%
Cost of equity6.9%12.8%
Tax rate29.2%29.5%
Debt/Equity ratio
1.531.53
Cost of debt5.0%5.0%
After-tax WACC4.9%7.2%
Selected WACC6.0%

ECX.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 ECX.AX:

cost_of_equity (9.85%) = risk_free_rate (4.35%) + equity_risk_premium (6.00%) * adjusted_beta (0.51) + 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.