LVH.AX WACC - Weighted Average Cost of Capital
The WACC of LiveHire Ltd (LVH.AX) is 7.9%.
| Range | Selected | |
| Cost of equity | 7.2% - 9.5% | 8.35% |
| Tax rate | 0.2% - 0.2% | 0.2% |
| Cost of debt | 4.0% - 4.6% | 4.3% |
| WACC | 6.8% - 8.9% | 7.9% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.61 | 0.74 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.2% | 9.5% |
| Tax rate | 0.2% | 0.2% |
| Debt/Equity ratio | 0.14 | 0.14 |
| Cost of debt | 4.0% | 4.6% |
| After-tax WACC | 6.8% | 8.9% |
| Selected WACC | 7.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| LVH.AX | LiveHire Ltd | 0.14 | 5.38 | 4.73 |
| AND.AX | Ansarada Group Ltd | 0.02 | 0.42 | 0.41 |
| BID.AX | Bill Identity Ltd | 0.04 | 1.53 | 1.47 |
| CAG.AX | Cape Range Ltd | 0 | -0.87 | -0.87 |
| CCR.AX | Credit Clear Ltd | 0.05 | 0.69 | 0.66 |
| DTS.AX | Dragontail Systems Ltd | 0.1 | -0.95 | -0.87 |
| HSC.AX | HSC Technology Group Ltd | 0.22 | 0.57 | 0.47 |
| IXU.AX | IXUP Ltd | 0.06 | -0.14 | -0.13 |
| JAN.AX | Janison Education Group Ltd | 0.01 | 0.32 | 0.32 |
| NET.AX | Netlinkz Ltd | 1.18 | 1.4 | 0.64 |
| YOJ.AX | Yojee Ltd | 0 | 1.12 | 1.12 |
| Low | High | |
| Unlevered beta | 0.41 | 0.64 |
| Relevered beta | 0.42 | 0.61 |
| Adjusted relevered beta | 0.61 | 0.74 |
LVH.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 LVH.AX:
cost_of_equity (8.35%) = risk_free_rate (4.25%) + equity_risk_premium (5.60%) * adjusted_beta (0.61) + 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.