NASB WACC - Weighted Average Cost of Capital
The WACC of NASB Financial Inc (NASB) is 7.1%.
| Range | Selected | |
| Cost of equity | 6.4% - 8.7% | 7.55% |
| Tax rate | 25.4% - 28.1% | 26.75% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.1% - 8.1% | 7.1% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 4.2% | 5.2% |
| Adjusted beta | 0.75 | 0.86 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.4% | 8.7% |
| Tax rate | 25.4% | 28.1% |
| Debt/Equity ratio | 0.11 | 0.11 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.1% | 8.1% |
| Selected WACC | 7.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| NASB | NASB Financial Inc | 0.11 | -0.08 | -0.08 |
| FSBW | FS Bancorp Inc | 0.15 | 0.83 | 0.75 |
| HBCP | Home Bancorp Inc | 0.14 | 1.12 | 1.01 |
| HMST | HomeStreet Inc | 3.12 | 0.4 | 0.12 |
| MKP.TO | MCAN Mortgage Corp | 6.17 | 0.69 | 0.12 |
| NFBK | Northfield Bancorp Inc | 0.14 | 1.19 | 1.08 |
| SMBC | Southern Missouri Bancorp Inc | 0.04 | 1.08 | 1.05 |
| TF.TO | Timbercreek Financial Corp | 1.52 | 1.08 | 0.5 |
| TRST | TrustCo Bank Corp N Y | 0.13 | 0.91 | 0.83 |
| WSBF | Waterstone Financial Inc | 0.01 | 0.64 | 0.64 |
| Low | High | |
| Unlevered beta | 0.58 | 0.78 |
| Relevered beta | 0.63 | 0.79 |
| Adjusted relevered beta | 0.75 | 0.86 |
NASB'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 NASB:
cost_of_equity (7.55%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * adjusted_beta (0.75) + 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.