CFY.V WACC - Weighted Average Cost of Capital

The WACC of CF Energy Corp (CFY.V) is 7.9%.

The Cost of Equity of CF Energy Corp (CFY.V) is 10.80%.

The Cost of Debt of CF Energy Corp (CFY.V) is 10.30%.

	Range	Selected
Cost of equity	8.50% - 13.10%	10.80%
Tax rate	26.20% - 27.00%	26.60%
Cost of debt	5.00% - 15.60%	10.30%
WACC	4.1% - 11.6%	7.9%

WACC

CFY.V WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.9	1.35

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.50%	13.10%

Tax rate	26.20%	27.00%
Debt/Equity ratio	9.48	9.48
Cost of debt	5.00%	15.60%

After-tax WACC	4.1%	11.6%


Selected WACC	7.9%

CFY.V'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 CFY.V:

cost_of_equity (10.80%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.9) + 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.