DFCO WACC - Weighted Average Cost of Capital
The WACC of Dalrada Financial Corp (DFCO) is 4.6%.
| Range | Selected | |
| Cost of equity | 5.1% - 7.5% | 6.3% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 4.6% - 7.0% | 5.8% |
| WACC | 3.7% - 5.5% | 4.6% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.28 | 0.47 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.1% | 7.5% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 5.14 | 5.14 |
| Cost of debt | 4.6% | 7.0% |
| After-tax WACC | 3.7% | 5.5% |
| Selected WACC | 4.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| DFCO | Dalrada Financial Corp | 5.14 | 7.2 | 1.52 |
| APSI | Aqua Power Systems Inc | 0.08 | -0.49 | -0.46 |
| BRSF | Brain Scientific Inc | 2.98 | -0.13 | -0.04 |
| BUX.CN | BioMark Diagnostics Inc | 0.03 | -0.24 | -0.23 |
| MCOA | Marijuana Company Of America Inc | 171.68 | 0.05 | 0 |
| PHCG | Pure Harvest Corporate Group Inc | 12.65 | 0.26 | 0.02 |
| RVIV | Reviv3 Procare Co | 0 | 0.07 | 0.07 |
| USDR | UAS Drone Corp | 0.06 | -1.03 | -0.99 |
| USLG | US Lighting Group Inc | 13.99 | 0.93 | 0.08 |
| WIFI.CN | American Aires Inc | 0.02 | 1.8 | 1.77 |
| YES.V | CHAR Technologies Ltd | 0.21 | 1.74 | 1.51 |
| Low | High | |
| Unlevered beta | 0 | 0.07 |
| Relevered beta | -0.07 | 0.21 |
| Adjusted relevered beta | 0.28 | 0.47 |
DFCO'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 DFCO:
cost_of_equity (6.30%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.28) + 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.