The WACC of Thien Nam Trading Import Export JSC (TNA.VN) is 4.5%.
| Range | Selected | |
| Cost of equity | 4.30% - 6.70% | 5.50% |
| Tax rate | 24.80% - 37.80% | 31.30% |
| Cost of debt | 4.00% - 8.20% | 6.10% |
| WACC | 3.4% - 5.6% | 4.5% |
| Category | Low | High |
| Long-term bond rate | 2.7% | 3.2% |
| Equity market risk premium | 9.5% | 10.5% |
| Adjusted beta | 0.16 | 0.28 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 4.30% | 6.70% |
| Tax rate | 24.80% | 37.80% |
| Debt/Equity ratio | 2.65 | 2.65 |
| Cost of debt | 4.00% | 8.20% |
| After-tax WACC | 3.4% | 5.6% |
| Selected WACC | 4.5% | |
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 TNA.VN:
cost_of_equity (5.50%) = risk_free_rate (2.95%) + equity_risk_premium (10.00%) * adjusted_beta (0.16) + 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.