APR.UN.TO
Automotive Properties Real Estate Investment Trust
Price:  
10.41 
CAD
Volume:  
10,150.00
Canada | Equity Real Estate Investment Trusts (REITs)
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APR.UN.TO WACC - Weighted Average Cost of Capital

The WACC of Automotive Properties Real Estate Investment Trust (APR.UN.TO) is 6.2%.

The Cost of Equity of Automotive Properties Real Estate Investment Trust (APR.UN.TO) is 8.85%.
The Cost of Debt of Automotive Properties Real Estate Investment Trust (APR.UN.TO) is 4.70%.

Range Selected
Cost of equity 6.30% - 11.40% 8.85%
Tax rate 25.90% - 26.50% 26.20%
Cost of debt 4.00% - 5.40% 4.70%
WACC 4.7% - 7.7% 6.2%
WACC

APR.UN.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.62 1.18
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.30% 11.40%
Tax rate 25.90% 26.50%
Debt/Equity ratio 0.98 0.98
Cost of debt 4.00% 5.40%
After-tax WACC 4.7% 7.7%
Selected WACC 6.2%

APR.UN.TO'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 APR.UN.TO:

cost_of_equity (8.85%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.62) + 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.