BRID WACC - Weighted Average Cost of Capital
The WACC of Bridgford Foods Corp (BRID) is 6.3%.
| Range | Selected | |
| Cost of equity | 5.6% - 7.2% | 6.4% |
| Tax rate | 25.8% - 27.1% | 26.45% |
| Cost of debt | 7.0% - 7.2% | 7.1% |
| WACC | 5.5% - 7.1% | 6.3% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.37 | 0.42 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.6% | 7.2% |
| Tax rate | 25.8% | 27.1% |
| Debt/Equity ratio | 0.04 | 0.04 |
| Cost of debt | 7.0% | 7.2% |
| After-tax WACC | 5.5% | 7.1% |
| Selected WACC | 6.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| BRID | Bridgford Foods Corp | 0.04 | 0.36 | 0.35 |
| AMNF | Armanino Foods Of Distinction Inc | 0.01 | 0.1 | 0.09 |
| BGA.V | BioNeutra Global Corp | 5.48 | 0.27 | 0.05 |
| CUSI | Cuisine Solutions Inc | 0.02 | -0.08 | -0.08 |
| ELAMF | Elamex SA de CV | 0.46 | 0.08 | 0.06 |
| GLG.TO | Glg Life Tech Corp | 33.27 | -0.49 | -0.02 |
| LUCC | Luca Inc | 0.17 | 1.1 | 0.98 |
| MMMB | MamaMancini's Holdings Inc | 0.07 | 0.42 | 0.4 |
| PLIN | China Xiangtai Food Co Ltd | 0.02 | 1.1 | 1.08 |
| SWP.TO | Swiss Water Decaffeinated Coffee Inc | 3.79 | 0.63 | 0.17 |
| Low | High | |
| Unlevered beta | 0.08 | 0.24 |
| Relevered beta | 0.06 | 0.13 |
| Adjusted relevered beta | 0.37 | 0.42 |
BRID'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 BRID:
cost_of_equity (6.40%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.37) + 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.