DRDR.TO
MCI Onehealth Technologies Inc
Price:  
0.81 
CAD
Volume:  
4,433.00
Canada | Health Care Providers & Services
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DRDR.TO WACC - Weighted Average Cost of Capital

The WACC of MCI Onehealth Technologies Inc (DRDR.TO) is 7.2%.

The Cost of Equity of MCI Onehealth Technologies Inc (DRDR.TO) is 8.40%.
The Cost of Debt of MCI Onehealth Technologies Inc (DRDR.TO) is 5.00%.

Range Selected
Cost of equity 6.70% - 10.10% 8.40%
Tax rate 11.00% - 17.80% 14.40%
Cost of debt 5.00% - 5.00% 5.00%
WACC 6.1% - 8.4% 7.2%
WACC

DRDR.TO WACC calculation

Category Low High
Long-term bond rate 3.6% 4.1%
Equity market risk premium 5.5% 6.5%
Adjusted beta 0.57 0.85
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.70% 10.10%
Tax rate 11.00% 17.80%
Debt/Equity ratio 0.4 0.4
Cost of debt 5.00% 5.00%
After-tax WACC 6.1% 8.4%
Selected WACC 7.2%

DRDR.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 DRDR.TO:

cost_of_equity (8.40%) = risk_free_rate (3.85%) + equity_risk_premium (6.00%) * adjusted_beta (0.57) + 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.