AOXG WACC - Weighted Average Cost of Capital

The WACC of Aoxing Pharmaceutical Company Inc (AOXG) is 13.7%.

The Cost of Equity of Aoxing Pharmaceutical Company Inc (AOXG) is 28.40%.

The Cost of Debt of Aoxing Pharmaceutical Company Inc (AOXG) is 18.20%.

	Range	Selected
Cost of equity	5.40% - 51.40%	28.40%
Tax rate	26.20% - 27.00%	26.60%
Cost of debt	12.50% - 23.90%	18.20%
WACC	9.1% - 18.2%	13.7%

WACC

AOXG WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	0.33	8.3

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.40%	51.40%

Tax rate	26.20%	27.00%
Debt/Equity ratio	44.57	44.57
Cost of debt	12.50%	23.90%

After-tax WACC	9.1%	18.2%


Selected WACC	13.7%

AOXG's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for AOXG:

cost_of_equity (28.40%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.33) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.