Sunlands Technology Group, American Depositary Shares, American Depositary Shares, every two (2) ADSs representing one (1) Class A Ordinary Share (STG) — WACC Analysis
WACC Breakdown
Sunlands Technology Group, American Depositary Shares, American Depositary Shares, every two (2) ADSs representing one (1) Class A Ordinary Share (STG) has a weighted average cost of capital (WACC) of 6.6%. The cost of equity is 6.6%, derived from a beta of 0.19 and a risk-free rate of 4.7%. The after-tax cost of debt is 4.0%. The capital structure is 100.0% equity and 0.0% debt.
Interpretation
A WACC of 6.6% suggests that the market views Sunlands Technology Group, American Depositary Shares, American Depositary Shares, every two (2) ADSs representing one (1) Class A Ordinary Share as relatively low-risk, with a lower cost of financing.
Investors can compare STG's WACC of 6.6% against industry peers to gauge its relative financing costs. A beta of 0.19 reflects the stock's volatility relative to the broader market.
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VALUATION
STG WACC: 6.62% for Sunlands Technology Group, American Depositary Shares, American Depositary Shares, every two (2) ADSs representing one (1) Class A Ordinary Share
Current inputs imply a 6.62% cost of equity and a 5.00% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.
WACC Calculator
This advanced WACC calculator uses real-time 10-year Treasury rates from FRED, equity risk premiums from Damodaran research, and comprehensive company financial data from SEC EDGAR XBRL filings to provide institutional-grade cost of capital calculations for DCF analysis and investment valuation. Click the info icons next to each input to see detailed data sources and calculation methodologies.
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WACC Calculation Process
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WACC Calculated
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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
Sunlands Technology Group, American Depositary Shares, American Depositary Shares, every two (2) ADSs representing one (1) Class A Ordinary Share Common Stock (STG) WACC Results
Weighted Average Cost of Capital
6.62%
Cost of Equity
6.62%
Risk-Free Rate4.67%
Beta0.19
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%($37.55M)
Debt: 0.00%($0.00M)
Equity Component
6.62%
100.00% × 6.62%
Debt Component
0.00%
0.00% × 3.95%
Sunlands Technology Group, American Depositary Shares, American Depositary Shares, every two (2) ADSs representing one (1) Class A Ordinary Share (STG) WACC in context
Sunlands Technology Group, American Depositary Shares, American Depositary Shares, every two (2) ADSs representing one (1) Class A Ordinary Share (STG) currently screens with an estimated WACC of 6.62%. That blends a 6.62% 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 STG WACC implies
A 6.62% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.
How this page calculates STG
This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.19 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.