Lutian Machinery CoSHSE:605259 -2.37%87 WACC % is 10.2% as of Jul. 09, 2026, which is 3% above its 10-year median of 9.88. GuruFocus rates SHSE:605259 with a GF Score™ of 87/100 and a GF Value™ of ¥23.51 (Modestly Undervalued). The stock has 4 warning signs investors should review. Among 3,084 Industrial Products companies, Lutian Machinery Co ranks worse than 54.54% on this metric.
As of today (2026-07-09), Lutian Machinery Co's weighted average cost of capital is 10.2%%. Lutian Machinery Co's ROIC % is 23.68% (calculated using TTM income statement data).
Lutian Machinery 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.
Lutian Machinery Co (SHSE:605259) 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, Lutian Machinery Co's weighted average cost of capital is 10.2%%. Lutian Machinery Co's ROIC % is 23.68% (calculated using TTM income statement data).
Lutian Machinery 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
Lutian Machinery Co WACC % Historical Data
* Premium members only.
The historical data trend for Lutian Machinery Co'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 Specialty Industrial Machinery subindustry, Lutian Machinery 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.
Lutian Machinery Co WACC % vs Industrial Products Industry
For the Industrial Products industry and Industrials sector, Lutian Machinery Co's WACC % distribution charts can be found below:
* The bar in red indicates where Lutian Machinery Co'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, Lutian Machinery Co's market capitalization (E) is ¥3061.520 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, Lutian Machinery Co's latest one-year quarterly average Book Value of Debt (D) is ¥8.1598 Mil.
a) weight of equity = E / (E + D) = 3061.520 / (3061.520 + 8.1598) = 0.9973
b) weight of debt = D / (E + D) = 8.1598 / (3061.520 + 8.1598) = 0.0027
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 4.561%. 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. Lutian Machinery Co's beta is 0.9437.
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 = 4.561% + 0.9437 * 6% = 10.2232%
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, Lutian Machinery Co's interest expense (positive number) was ¥0.276 Mil. Its total Book Value of Debt (D) is ¥8.1598 Mil.
Cost of Debt = 0.276 / 8.1598 = 3.3824%.
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 = 26.512 / 246.76 = 10.74%.
Lutian Machinery Co'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)
=
0.9973
*
10.2232%
+
0.0027
*
3.3824%
*
(1 - 10.74%)
=
10.2%
* 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.
Lutian Machinery Co (SHSE:605259) has a WACC % of 10.2% 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 Lutian Machinery Co and its competitors. This is near median its historical median of 9.88. Over the past decade, Lutian Machinery Co's WACC % has ranged from 7.52 to 360.57. According to the industry distribution chart, Lutian Machinery Co ranks #1682 out of 3084 companies in the Industrial Products industry, placing it in the top 54.5%.
Is Lutian Machinery Co's WACC % too high?
Lutian Machinery Co's current WACC % of 10.2% is near median its 10-year median of 9.88. Over the past 10 years, this metric has ranged from a low of 7.52 to a high of 360.57. The Industrial Products industry median WACC % is 9.67. Lutian Machinery Co's value of 10.2% is 5.5% above this industry median. Based on the distribution chart, Lutian Machinery Co ranks #1682 out of 3084 companies in the Industrial Products industry, which is below the industry midpoint. Overall, Lutian Machinery Co has a GF Score™ of 87/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Lutian Machinery Co's WACC % compare to GEV and ETN?
According to the Industrial Products industry distribution chart, Lutian Machinery Co ranks #1682 out of 3084 companies for WACC %. This places Lutian Machinery Co in the lower half of its industry. The industry median WACC % is 9.67. Lutian Machinery Co's value of 10.2% is 5.5% above this benchmark. Historically, Lutian Machinery Co's own WACC % has ranged from 7.52 to 360.57 over the past decade. While the company's 10-year median is 9.88 vs. the industry median of 9.67, Lutian Machinery 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 Products company?
The median WACC % among Industrial Products companies is 9.67, based on 3,084 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. Lutian Machinery Co's current WACC % of 10.2% is 5.5% 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 Lutian Machinery Co and its competitors. For the Industrial Products industry, the median WACC % is 9.67 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Lutian Machinery Co's current WACC % is 10.2%, which is near median its own 10-year median of 9.88. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Lutian Machinery Co stock overvalued right now?
Based on GuruFocus' analysis, Lutian Machinery Co (SHSE:605259) is currently considered Modestly Undervalued. The stock's GF Value™ is ¥23.51, compared to a current price of ¥17.75 — trading 24.5% below its estimated fair value. The current WACC % is 10.2%, which is near median its 10-year median of 9.88 and 5.5% above the Industrial Products industry median of 9.67. Lutian Machinery Co's overall GF Score™ is 87/100 with 4 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 Lutian Machinery Co (SHSE:605259), the current WACC % is 10.2% 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 Lutian Machinery Co (SHSE:605259) Overvalued in 2026?
Based on GuruFocus' analysis, Lutian Machinery Co stock appears to be undervalued.
The current stock price of ¥17.75 is trading 24.5% below its estimated GF Value™ of ¥23.51.
GuruFocus considers Lutian Machinery Co to be Modestly Undervalued.
Key valuation signals for SHSE:605259:
WACC %: 10.2% (near median its 10-year median of 9.88)
GF Value™: ¥23.51 vs. price of ¥17.75 (24.5% below fair value)
Industry Position: 5.5% above the Industrial Products median (#1682 of 3084)
No single metric tells the full story. See the SHSE:605259 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Lutian Machinery Co Ltd research and development, production and sales of general power machinery products mainly including generator sets, water pump units and engines and high-pressure cleaner products.
87GF Score
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