DND.TO
Dye & Durham Ltd
Price:  
9.68 
CAD
Volume:  
301,764.00
Canada | Software
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DND.TO WACC - Weighted Average Cost of Capital

The WACC of Dye & Durham Ltd (DND.TO) is 11.1%.

The Cost of Equity of Dye & Durham Ltd (DND.TO) is 12.70%.
The Cost of Debt of Dye & Durham Ltd (DND.TO) is 12.55%.

Range Selected
Cost of equity 11.30% - 14.10% 12.70%
Tax rate 14.50% - 17.90% 16.20%
Cost of debt 10.20% - 14.90% 12.55%
WACC 9.5% - 12.8% 11.1%
WACC

DND.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 1.6 1.63
Additional risk adjustments 0.0% 0.5%
Cost of equity 11.30% 14.10%
Tax rate 14.50% 17.90%
Debt/Equity ratio 2.39 2.39
Cost of debt 10.20% 14.90%
After-tax WACC 9.5% 12.8%
Selected WACC 11.1%

DND.TO'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 DND.TO:

cost_of_equity (12.70%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.6) + 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.