The WACC of China Industrial Waste Management Inc (CIWT) is 8.0%.
| Range | Selected | |
| Cost of equity | 39,367.30% - 59,854.50% | 49,610.90% |
| Tax rate | 1.60% - 6.40% | 4.00% |
| Cost of debt | 4.90% - 4.90% | 4.90% |
| WACC | 7.4% - 8.6% | 8.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 8557.27 | 10687.44 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 39,367.30% | 59,854.50% |
| Tax rate | 1.60% | 6.40% |
| Debt/Equity ratio | 15200.28 | 15200.28 |
| Cost of debt | 4.90% | 4.90% |
| After-tax WACC | 7.4% | 8.6% |
| Selected WACC | 8.0% | |
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 CIWT:
cost_of_equity (49,610.90%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (8557.27) + 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.