The WACC of Hatinh Book And Equiptment Education JSC (HBE.VN) is 8.7%.
| Range | Selected | |
| Cost of equity | 7.40% - 10.40% | 8.90% |
| Tax rate | 11.30% - 15.00% | 13.15% |
| Cost of debt | 4.00% - 7.00% | 5.50% |
| WACC | 7.2% - 10.2% | 8.7% |
| Category | Low | High |
| Long-term bond rate | 3.3% | 3.8% |
| Equity market risk premium | 8.3% | 9.3% |
| Adjusted beta | 0.5 | 0.66 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.40% | 10.40% |
| Tax rate | 11.30% | 15.00% |
| Debt/Equity ratio | 0.05 | 0.05 |
| Cost of debt | 4.00% | 7.00% |
| After-tax WACC | 7.2% | 10.2% |
| Selected WACC | 8.7% | |
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 HBE.VN:
cost_of_equity (8.90%) = risk_free_rate (3.55%) + equity_risk_premium (8.80%) * adjusted_beta (0.5) + 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.