THFF
First Financial Corp
Price:  
53.31 
USD
Volume:  
42,276.00
United States | Banks
Valuation
Overview
Financials
Forecast
Compare
Historical Price
SolvencyDividends
Transactions
People

THFF WACC - Weighted Average Cost of Capital

The WACC of First Financial Corp (THFF) is 8.2%.

The Cost of Equity of First Financial Corp (THFF) is 9.55%.
The Cost of Debt of First Financial Corp (THFF) is 5.00%.

Range Selected
Cost of equity 7.90% - 11.20% 9.55%
Tax rate 17.60% - 18.30% 17.95%
Cost of debt 5.00% - 5.00% 5.00%
WACC 6.9% - 9.4% 8.2%
WACC

THFF WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.87 1.13
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.90% 11.20%
Tax rate 17.60% 18.30%
Debt/Equity ratio 0.33 0.33
Cost of debt 5.00% 5.00%
After-tax WACC 6.9% 9.4%
Selected WACC 8.2%

THFF'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 THFF:

cost_of_equity (9.55%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.87) + 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.