The WACC of Quantum Medical Transport Inc (DRWN) is 32.5%.
| Range | Selected | |
| Cost of equity | 48,800.10% - 87,794.40% | 68,297.25% |
| Tax rate | 5.10% - 7.30% | 6.20% |
| Cost of debt | 23.90% - 40.50% | 32.20% |
| WACC | 24.3% - 40.6% | 32.5% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 10607.88 | 15676.7 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 48,800.10% | 87,794.40% |
| Tax rate | 5.10% | 7.30% |
| Debt/Equity ratio | 28765.54 | 28765.54 |
| Cost of debt | 23.90% | 40.50% |
| After-tax WACC | 24.3% | 40.6% |
| Selected WACC | 32.5% | |
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 DRWN:
cost_of_equity (68,297.25%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (10607.88) + 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.