KRUS WACC - Weighted Average Cost of Capital
The WACC of Kura Sushi USA Inc (KRUS) is 5.8%.
| Range | Selected | |
| Cost of equity | 6.0% - 9.4% | 7.7% |
| Tax rate | 5.2% - 9.2% | 7.2% |
| Cost of debt | 4.0% - 4.5% | 4.25% |
| WACC | 4.9% - 6.7% | 5.8% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.47 | 0.81 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.0% | 9.4% |
| Tax rate | 5.2% | 9.2% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 4.0% | 4.5% |
| After-tax WACC | 4.9% | 6.7% |
| Selected WACC | 5.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| KRUS | Kura Sushi USA Inc | 0.85 | 1.54 | 0.86 |
| AW.UN.TO | A and W Revenue Royalties Income Fund | 0.11 | 0.47 | 0.43 |
| BFI | Burgerfi International Inc | 5455.2 | -0.8 | 0 |
| BPF.UN.TO | Boston Pizza Royalties Income Fund | 0.21 | 0.84 | 0.7 |
| COFE | Cafe Holdings Inc | 2.16 | -1.07 | -0.35 |
| FAT | FAT Brands Inc | 32.24 | 0.44 | 0.01 |
| GRLT | Healthy & Tasty Brands Corp | 0.16 | 0.39 | 0.34 |
| NATH | Nathan's Famous Inc | 0.14 | 0.7 | 0.62 |
| NROM | Noble Roman's Inc | 2.22 | -0.13 | -0.04 |
| PZA.TO | Pizza Pizza Royalty Corp | 0.13 | 0.63 | 0.56 |
| WCVC | West Coast Ventures Group Corp | 5.09 | 0.97 | 0.17 |
| Low | High | |
| Unlevered beta | 0.17 | 0.43 |
| Relevered beta | 0.21 | 0.72 |
| Adjusted relevered beta | 0.47 | 0.81 |
KRUS'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 KRUS:
cost_of_equity (7.70%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.47) + 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.