AYR.A.CN WACC - Weighted Average Cost of Capital
The WACC of Ayr Wellness Inc (AYR.A.CN) is 10.8%.
| Range | Selected | |
| Cost of equity | 16.4% - 34.3% | 25.35% |
| Tax rate | 25.9% - 26.5% | 26.2% |
| Cost of debt | 7.0% - 20.0% | 13.5% |
| WACC | 5.8% - 15.8% | 10.8% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 2.59 | 4.94 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 16.4% | 34.3% |
| Tax rate | 25.9% | 26.5% |
| Debt/Equity ratio | 16.12 | 16.12 |
| Cost of debt | 7.0% | 20.0% |
| After-tax WACC | 5.8% | 15.8% |
| Selected WACC | 10.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| AYR.A.CN | Ayr Wellness Inc | 16.12 | 2.94 | 0.23 |
| ACB.TO | Aurora Cannabis Inc | 0.27 | 1.56 | 1.3 |
| ANIP | ANI Pharmaceuticals Inc | 0.48 | 0.33 | 0.24 |
| CWEB.TO | Charlotte's Web Holdings Inc | 3.1 | 0.82 | 0.25 |
| HRMY | Harmony Biosciences Holdings Inc | 0.09 | 1.21 | 1.14 |
| INLB | Item 9 Labs Corp | 38316.48 | -0.37 | 0 |
| INVA | Innoviva Inc | 0.38 | 0.35 | 0.27 |
| SNDL | Sundial Growers Inc | 0.31 | 0.41 | 0.33 |
| TBPH | Theravance Biopharma Inc | 0.07 | 1.08 | 1.03 |
| VRCA | Verrica Pharmaceuticals Inc | 0.74 | -0.67 | -0.43 |
| ZGNX | Zogenix Inc | 0.11 | 0.9 | 0.84 |
| Low | High | |
| Unlevered beta | 0.25 | 0.33 |
| Relevered beta | 3.37 | 6.88 |
| Adjusted relevered beta | 2.59 | 4.94 |
AYR.A.CN'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 AYR.A.CN:
cost_of_equity (25.35%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (2.59) + 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.