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Deswell Industries Inc (DSWL) — WACC Analysis

WACC Breakdown

Deswell Industries Inc (DSWL) has a weighted average cost of capital (WACC) of 7.0%. The cost of equity is 7.0%, derived from a beta of 0.12 and a risk-free rate of 5.2%. The after-tax cost of debt is 4.0%. The capital structure is 100.0% equity and 0.0% debt.

Interpretation

A WACC of 7.0% suggests that the market views Deswell Industries Inc as relatively low-risk, with a lower cost of financing.

Investors can compare DSWL's WACC of 7.0% against industry peers to gauge its relative financing costs. A beta of 0.12 reflects the stock's volatility relative to the broader market.

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VALUATION

DSWL WACC: 6.96% for Deswell Industries Inc

Current inputs imply a 6.96% cost of equity and a 5.00% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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[02]
WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

Deswell Industries Inc Common Stock (DSWL) WACC Results
Weighted Average Cost of Capital
6.96%
Cost of Equity
6.96%
Risk-Free Rate5.21%
Beta0.12
Market Risk Premium4.23%
Cost of Debt
3.95%
Pre-Tax Cost of Debt5.00%
Tax Rate21.00%
Tax Shield1.05%
Capital Structure
Equity: 100.00%($48.93M)
Debt: 0.00%($0.00M)
Equity Component
6.96%
100.00% × 6.96%
Debt Component
0.00%
0.00% × 3.95%

Deswell Industries Inc (DSWL) WACC in context

Deswell Industries Inc (DSWL) currently screens with an estimated WACC of 6.96%. That blends a 6.96% cost of equity, a 5.00% pre-tax cost of debt, and a 100.00% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What DSWL WACC implies

A 6.96% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates DSWL

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.12 and equity accounts for 100.00% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.