CHV.CN
Canada House Cannabis Group Inc
Price:  
0.04 
CAD
Volume:  
198,350.00
Canada | Pharmaceuticals
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CHV.CN WACC - Weighted Average Cost of Capital

The WACC of Canada House Cannabis Group Inc (CHV.CN) is 5.9%.

The Cost of Equity of Canada House Cannabis Group Inc (CHV.CN) is 6.30%.
The Cost of Debt of Canada House Cannabis Group Inc (CHV.CN) is 5.50%.

Range Selected
Cost of equity 5.50% - 7.10% 6.30%
Tax rate 0.50% - 0.90% 0.70%
Cost of debt 4.00% - 7.00% 5.50%
WACC 4.7% - 7.0% 5.9%
WACC

CHV.CN WACC calculation

Category Low High
Long-term bond rate 3.6% 4.1%
Equity market risk premium 5.5% 6.5%
Adjusted beta 0.35 0.39
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.50% 7.10%
Tax rate 0.50% 0.90%
Debt/Equity ratio 1 1
Cost of debt 4.00% 7.00%
After-tax WACC 4.7% 7.0%
Selected WACC 5.9%

CHV.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 CHV.CN:

cost_of_equity (6.30%) = risk_free_rate (3.85%) + equity_risk_premium (6.00%) * adjusted_beta (0.35) + 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.