BRST WACC - Weighted Average Cost of Capital

The WACC of Broad Street Realty Inc (BRST) is 11.5%.

The Cost of Equity of Broad Street Realty Inc (BRST) is 45.35%.

The Cost of Debt of Broad Street Realty Inc (BRST) is 15.25%.

	Range	Selected
Cost of equity	19.00% - 71.70%	45.35%
Tax rate	24.50% - 25.40%	24.95%
Cost of debt	6.60% - 23.90%	15.25%
WACC	5.1% - 18.0%	11.5%

WACC

BRST WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	4.6%	5.6%
Adjusted beta	3.28	11.94

Additional risk adjustments	0.0%	0.5%
Cost of equity	19.00%	71.70%

Tax rate	24.50%	25.40%
Debt/Equity ratio	351.47	351.47
Cost of debt	6.60%	23.90%

After-tax WACC	5.1%	18.0%


Selected WACC	11.5%

BRST'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 BRST:

cost_of_equity (45.35%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (3.28) + 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.