Lufax HoldingLU -3.91%49 WACC % is 6.7% as of Jun. 26, 2026, which is 34% below its 10-year median of 10.13. GuruFocus rates LU with a GF Score™ of 49/100 and a GF Value™ of $2.62 (Significantly Undervalued). The stock has 1 warning sign investors should review. Among 555 Credit Services companies, Lufax Holding ranks better than 53.15% on this metric.
As of today (2026-06-26), Lufax Holding's weighted average cost of capital is 6.7%%. Lufax Holding's ROIC % is 0.00% (calculated using TTM income statement data).
Lufax Holding earns returns that do not match up to its cost of capital. It will destroy value as it grows.
For a comprehensive WACC calculation, please access the WACC Calculator.
Lufax Holding (NYSE:LU) WACC % Explanation
Because it costs money to raise capital. A firm that generates higher ROIC % than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Lufax Holding's weighted average cost of capital is 6.7%%. Lufax Holding's ROIC % is 0.00% (calculated using TTM income statement data).
Lufax Holding earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together.
For companies that report quarterly, GuruFocus combines all of the most recent year's quarterly debt data from the beginning of the year to the year-end and calculates the average.
For companies that report semi-annually, GuruFocus combines all of the most recent year's semi-annual debt data from the start of the year to the year-end and calculates the average.
For companies that report annually, GuruFocus combines the beginning and ending annual debt data from the most recent year and then calculates the average.
2. The WACC formula discussed above does not include Preferred Stock. Please adjust if preferred stock is considered.
3. (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
4. GuruFocus uses the latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
Related Terms
Lufax Holding WACC % Historical Data
* Premium members only.
The historical data trend for Lufax Holding's WACC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Credit Services subindustry, Lufax Holding's WACC %, along with its competitors' market caps and WACC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Lufax Holding WACC % vs Credit Services Industry
For the Credit Services industry and Financial Services sector, Lufax Holding's WACC % distribution charts can be found below:
* The bar in red indicates where Lufax Holding's WACC % falls into.
The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. The WACC is commonly referred to as the firm's cost of capital. Generally speaking, a company's assets are financed by debt and equity. WACC is the average of the costs of these sources of financing, each of which is weighted by its respective use in the given situation. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances.
WACC
=
E
/
(E + D)
*
Cost of Equity
+
D
/
(E + D)
*
Cost of Debt
*
(1 - Tax Rate)
1. Weights:
Generally speaking, a company's assets are financed by debt and equity. We need to calculate the weight of equity and the weight of debt.
The market value of equity (E) is also called "Market Cap". As of today, Lufax Holding's market capitalization (E) is $1066.029 Mil.
The market value of debt is typically difficult to calculate, therefore, GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding the latest one-year semi-annual average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Dec. 2025, Lufax Holding's latest one-year semi-annual average Book Value of Debt (D) is $8735.184 Mil.
a) weight of equity = E / (E + D) = 1066.029 / (1066.029 + 8735.184) = 0.1088
b) weight of debt = D / (E + D) = 8735.184 / (1066.029 + 8735.184) = 0.8912
2. Cost of Equity:
GuruFocus uses Capital Asset Pricing Model (CAPM) to calculate the required rate of return. The formula is:
Cost of Equity = Risk-Free Rate of Return + Beta of Asset * (Expected Return of the Market - Risk-Free Rate of Return)
a) GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate. It is updated daily. The current risk-free rate is 4.38%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default.
b) Beta is the sensitivity of the expected excess asset returns to the expected excess market returns. Lufax Holding's beta is 1.0585.
c) (Expected Return of the Market - Risk-Free Rate of Return) is also called market premium. GuruFocus requires market premium to be 6%.
Cost of Equity = 4.38% + 1.0585 * 6% = 10.731%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year semi-annual average debt to get the simplified cost of debt.
As of Dec. 2025, Lufax Holding's interest expense (positive number) was $541.855 Mil. Its total Book Value of Debt (D) is $8735.184 Mil.
Cost of Debt = 541.855 / 8735.184 = 6.2031%.
4. Multiply by one minus TTM Tax Rate:
GuruFocus uses the most recent TTM Tax Expense divided by the most recent TTM Pre-Tax Income to calculate the tax rate. The calculated TTM tax rate is limited to between 0% and 100%. If the calculated tax rate is higher than 100%, it is set to 100%. If the calculated tax rate is less than 0%, it is set to 0%.
The latest calculated TTM Tax Rate = 158.248 / -83.361 = -189.83%, which is less than 0%. Therefore it's set to 0%.
Lufax Holding's Weighted Average Cost Of Capital (WACC) for Today is calculated as:
WACC
=
E / (E + D)
*
Cost of Equity
+
D / (E + D)
*
Cost of Debt
*
(1 - Tax Rate)
=
0.1088
*
10.731%
+
0.8912
*
6.2031%
*
(1 - 0%)
=
6.7%
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Lufax Holding (LU) has a WACC % of 6.7% as of Jun. 26, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Lufax Holding and its competitors. This is 34% below median its historical median of 10.13. Over the past decade, Lufax Holding's WACC % has ranged from 6.69 to 14.25. According to the industry distribution chart, Lufax Holding ranks #260 out of 555 companies in the Credit Services industry, placing it in the top 46.8%.
Is Lufax Holding's WACC % too high?
Lufax Holding's current WACC % of 6.7% is 34% below median its 10-year median of 10.13. Over the past 10 years, this metric has ranged from a low of 6.69 to a high of 14.25. The Credit Services industry median WACC % is 7.29. Lufax Holding's value of 6.7% is 8.1% below this industry median. Based on the distribution chart, Lufax Holding ranks #260 out of 555 companies in the Credit Services industry, which is above the industry midpoint. Overall, Lufax Holding has a GF Score™ of 49/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Lufax Holding's WACC % compare to ATLC and FINV?
According to the Credit Services industry distribution chart, Lufax Holding ranks #260 out of 555 companies for WACC %. This puts Lufax Holding in the upper half of its industry. The industry median WACC % is 7.29. Lufax Holding's value of 6.7% is 8.1% below this benchmark. Historically, Lufax Holding's own WACC % has ranged from 6.69 to 14.25 over the past decade. While the company's 10-year median is 10.13 vs. the industry median of 7.29, Lufax Holding has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good WACC % for a Credit Services company?
The median WACC % among Credit Services companies is 7.29, based on 555 companies in the industry. Companies in the top quartile (top 25%) have a WACC % significantly above this median, while those in the bottom quartile fall well below. However, WACC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Lufax Holding's current WACC % of 6.7% is 8.1% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high WACC % mean?
A high WACC % can signal that a stock is expensive relative to its fundamentals. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Lufax Holding and its competitors. For the Credit Services industry, the median WACC % is 7.29 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Lufax Holding's current WACC % is 6.7%, which is 34% below median its own 10-year median of 10.13. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Lufax Holding stock overvalued right now?
Based on GuruFocus' analysis, Lufax Holding (LU) is currently considered Significantly Undervalued. The stock's GF Value™ is $2.62, compared to a current price of $1.23 — trading 53.1% below its estimated fair value. The current WACC % is 6.7%, which is 34% below median its 10-year median of 10.13 and 8.1% below the Credit Services industry median of 7.29. Lufax Holding's overall GF Score™ is 49/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is WACC % calculated?
WACC % is calculated from a company's financial statements. For Lufax Holding (LU), the current WACC % is 6.7% as of Jun. 26, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Lufax Holding (LU) Overvalued in 2026?
Based on GuruFocus' analysis, Lufax Holding stock appears to be undervalued.
The current stock price of $1.23 is trading 53.1% below its estimated GF Value™ of $2.62.
GuruFocus considers Lufax Holding to be Significantly Undervalued.
Key valuation signals for LU:
WACC %: 6.7% (34% below median its 10-year median of 10.13)
GF Value™: $2.62 vs. price of $1.23 (53.1% below fair value)
Industry Position: 8.1% below the Credit Services median (#260 of 555)
No single metric tells the full story. See the LU stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Lufax Holding Ltd is an investment holding company, together with its consolidated subsidiaries, engaged in core retail credit and enablement business to both borrowers and institutions in the People's Republic of China. The group's segments are Lending-related business, which provides Retail credit and enablement, consumer finance loans, and Digital banking business, including Retail banking and SME banking.
49GF Score
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