Shandong Hiking International CoSHSE:600735 -0.63%61 WACC % is 10.55% as of Jul. 09, 2026, which is 1% below its 10-year median of 10.64. GuruFocus rates SHSE:600735 with a GF Score™ of 61/100 and a GF Value™ of ¥3.85 (Significantly Overvalued). The stock has 2 warning signs investors should review. Among 159 Industrial Distribution companies, Shandong Hiking International Co ranks worse than 83.02% on this metric.
As of today (2026-07-09), Shandong Hiking International Co's weighted average cost of capital is 10.55%%. Shandong Hiking International Co's ROIC % is 12.36% (calculated using TTM income statement data).
Shandong Hiking International Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
For a comprehensive WACC calculation, please access the WACC Calculator.
Shandong Hiking International Co (SHSE:600735) 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, Shandong Hiking International Co's weighted average cost of capital is 10.55%%. Shandong Hiking International Co's ROIC % is 12.36% (calculated using TTM income statement data).
Shandong Hiking International Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.
Be Aware
1. GuruFocus uses book value of debt (D) to do the calculation. It is simplified by adding latest one-year quarterly 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 quarterly average debt to get the simplified cost of debt.
Related Terms
Shandong Hiking International Co WACC % Historical Data
* 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 Industrial Distribution subindustry, Shandong Hiking International Co'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.
Shandong Hiking International Co WACC % vs Industrial Distribution Industry
For the Industrial Distribution industry and Industrials sector, Shandong Hiking International Co's WACC % distribution charts can be found below:
* The bar in red indicates where Shandong Hiking International Co's WACC % falls into.
Shandong Hiking International Co WACC % Calculation
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, Shandong Hiking International Co's market capitalization (E) is ¥2692.727 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 quarterly average Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation together. As of Mar. 2026, Shandong Hiking International Co's latest one-year quarterly average Book Value of Debt (D) is ¥89.0916 Mil.
a) weight of equity = E / (E + D) = 2692.727 / (2692.727 + 89.0916) = 0.968
b) weight of debt = D / (E + D) = 89.0916 / (2692.727 + 89.0916) = 0.032
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 4.577%. 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. Shandong Hiking International Co's beta is 1.0187.
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 = 4.577% + 1.0187 * 6% = 10.6892%
3. Cost of Debt:
GuruFocus uses latest TTM Interest Expense divided by the latest one-year quarterly average debt to get the simplified cost of debt.
As of Mar. 2026, Shandong Hiking International Co's interest expense (positive number) was ¥5.776 Mil. Its total Book Value of Debt (D) is ¥89.0916 Mil.
Cost of Debt = 5.776 / 89.0916 = 6.4832%.
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 = 49.566 / -40.68 = -121.84%, which is less than 0%. Therefore it's set to 0%.
* 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.
Shandong Hiking International Co (SHSE:600735) has a WACC % of 10.55% as of Jul. 09, 2026. The weighted average cost of capital (WACC) is the average rate a company pays to finance assets. View historical data on Shandong Hiking International Co and its competitors. This is near median its historical median of 10.64. Over the past decade, Shandong Hiking International Co's WACC % has ranged from 9.33 to 14.02. According to the industry distribution chart, Shandong Hiking International Co ranks #132 out of 159 companies in the Industrial Distribution industry, placing it in the top 83%.
Is Shandong Hiking International Co's WACC % too high?
Shandong Hiking International Co's current WACC % of 10.55% is near median its 10-year median of 10.64. Over the past 10 years, this metric has ranged from a low of 9.33 to a high of 14.02. The Industrial Distribution industry median WACC % is 6.90. Shandong Hiking International Co's value of 10.55% is 52.9% above this industry median. Based on the distribution chart, Shandong Hiking International Co ranks #132 out of 159 companies in the Industrial Distribution industry, which is in the bottom quartile relative to peers. Overall, Shandong Hiking International Co has a GF Score™ of 61/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Shandong Hiking International Co's WACC % compare to GWW and FAST?
According to the Industrial Distribution industry distribution chart, Shandong Hiking International Co ranks #132 out of 159 companies for WACC %. This places Shandong Hiking International Co in the lower half of its industry. The industry median WACC % is 6.90. Shandong Hiking International Co's value of 10.55% is 52.9% above this benchmark. Historically, Shandong Hiking International Co's own WACC % has ranged from 9.33 to 14.02 over the past decade. While the company's 10-year median is 10.64 vs. the industry median of 6.90, Shandong Hiking International Co has consistently been above 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 an Industrial Distribution company?
The median WACC % among Industrial Distribution companies is 6.90, based on 159 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. Shandong Hiking International Co's current WACC % of 10.55% is 52.9% above 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 Shandong Hiking International Co and its competitors. For the Industrial Distribution industry, the median WACC % is 6.90 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Shandong Hiking International Co's current WACC % is 10.55%, which is near median its own 10-year median of 10.64. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Shandong Hiking International Co stock overvalued right now?
Based on GuruFocus' analysis, Shandong Hiking International Co (SHSE:600735) is currently considered Significantly Overvalued. The stock's GF Value™ is ¥3.85, compared to a current price of ¥6.28 — trading 63.1% above its estimated fair value. The current WACC % is 10.55%, which is near median its 10-year median of 10.64 and 52.9% above the Industrial Distribution industry median of 6.90. Shandong Hiking International Co's overall GF Score™ is 61/100 with 2 warning signs 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 Shandong Hiking International Co (SHSE:600735), the current WACC % is 10.55% as of Jul. 09, 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 Shandong Hiking International Co (SHSE:600735) Overvalued in 2026?
Based on GuruFocus' analysis, Shandong Hiking International Co stock appears to be overvalued.
The current stock price of ¥6.28 is trading 63.1% above its estimated GF Value™ of ¥3.85.
GuruFocus considers Shandong Hiking International Co to be Significantly Overvalued.
Key valuation signals for SHSE:600735:
WACC %: 10.55% (near median its 10-year median of 10.64)
GF Value™: ¥3.85 vs. price of ¥6.28 (63.1% above fair value)
Industry Position: 52.9% above the Industrial Distribution median (#132 of 159)
No single metric tells the full story. See the SHSE:600735 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Shandong Hiking International Co Business Description
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