CODX WACC - Weighted Average Cost of Capital
The WACC of Co-Diagnostics Inc (CODX) is 6.1%.
| Range | Selected | |
| Cost of equity | 6.3% - 8.7% | 7.5% |
| Tax rate | 4.5% - 12.2% | 8.35% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.6% - 6.5% | 6.1% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.54 | 0.68 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.3% | 8.7% |
| Tax rate | 4.5% | 12.2% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.6% | 6.5% |
| Selected WACC | 6.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| CODX | Co-Diagnostics Inc | 0.81 | 1.39 | 0.79 |
| ABT | Abbott Laboratories | 0.06 | 0.26 | 0.25 |
| AFIB | Acutus Medical Inc | 36.29 | 0.24 | 0.01 |
| AXDX | Accelerate Diagnostics Inc | 17.01 | 0.31 | 0.02 |
| BDX | Becton Dickinson and Co | 0.42 | 0.16 | 0.12 |
| CTSO | Cytosorbents Corp | 0.26 | 0.24 | 0.19 |
| DRIO | DarioHealth Corp | 0.93 | 1.46 | 0.78 |
| HTL.V | Hamilton Thorne Ltd | 0.13 | -0.61 | -0.55 |
| MLSS | Milestone Scientific Inc | 0 | 0.99 | 0.99 |
| PRN.TO | Profound Medical Corp | 0.04 | 1.34 | 1.3 |
| XAIR | Beyond Air Inc | 0.9 | 0.58 | 0.32 |
| Low | High | |
| Unlevered beta | 0.19 | 0.32 |
| Relevered beta | 0.31 | 0.52 |
| Adjusted relevered beta | 0.54 | 0.68 |
CODX'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 CODX:
cost_of_equity (7.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.54) + 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.