KGN.AX WACC - Weighted Average Cost of Capital
The WACC of Kogan.com Ltd (KGN.AX) is 9.0%.
| Range | Selected | |
| Cost of equity | 7.7% - 10.9% | 9.3% |
| Tax rate | 31.6% - 46.7% | 39.15% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 7.5% - 10.6% | 9.0% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.73 | 0.96 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.7% | 10.9% |
| Tax rate | 31.6% | 46.7% |
| Debt/Equity ratio | 0.05 | 0.05 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 7.5% | 10.6% |
| Selected WACC | 9.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| KGN.AX | Kogan.com Ltd | 0.05 | 0.99 | 0.96 |
| 1137.HK | Hong Kong Television Network Ltd | 0.35 | 0.52 | 0.42 |
| 138250.KS | NS Shopping Co Ltd | 1.42 | 1.11 | 0.57 |
| 290510.KQ | KoreaCenter Co Ltd | 0.19 | 1 | 0.88 |
| 3182.T | Oisix Ra Daichi Inc | 0.87 | 0.76 | 0.48 |
| ABY.AX | Adore Beauty Group Ltd | 0.02 | 0.54 | 0.53 |
| HT8.AX | Harris Technology Group Ltd | 0.96 | 0.96 | 0.58 |
| MYD.AX | Mydeal.ComAu Pty Ltd | 0 | 0.99 | 0.99 |
| TPW.AX | Temple & Webster Group Ltd | 0.01 | 1.84 | 1.83 |
| WEB.AX | Webjet Ltd | 0.16 | 1.07 | 0.97 |
| Low | High | |
| Unlevered beta | 0.57 | 0.91 |
| Relevered beta | 0.6 | 0.94 |
| Adjusted relevered beta | 0.73 | 0.96 |
KGN.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 KGN.AX:
cost_of_equity (9.30%) = risk_free_rate (4.25%) + equity_risk_premium (5.60%) * adjusted_beta (0.73) + 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.