CARE.TO WACC - Weighted Average Cost of Capital

The WACC of Dialogue Health Technologies Inc (CARE.TO) is 6.7%.

The Cost of Equity of Dialogue Health Technologies Inc (CARE.TO) is 6.70%.

The Cost of Debt of Dialogue Health Technologies Inc (CARE.TO) is 5.50%.

	Range	Selected
Cost of equity	5.60% - 7.80%	6.70%
Tax rate	0.10% - 0.50%	0.30%
Cost of debt	4.00% - 7.00%	5.50%
WACC	5.6% - 7.8%	6.7%

WACC

CARE.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.47	0.59

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.60%	7.80%

Tax rate	0.10%	0.50%
Debt/Equity ratio	0.01	0.01
Cost of debt	4.00%	7.00%

After-tax WACC	5.6%	7.8%


Selected WACC	6.7%

CARE.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 CARE.TO:

cost_of_equity (6.70%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.47) + 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.