FANS.TO
Fansunite Entertainment Inc
Price:  
0.07 
CAD
Volume:  
1,222,370.00
Canada | N/A
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FANS.TO WACC - Weighted Average Cost of Capital

The WACC of Fansunite Entertainment Inc (FANS.TO) is 8.8%.

The Cost of Equity of Fansunite Entertainment Inc (FANS.TO) is 9.50%.
The Cost of Debt of Fansunite Entertainment Inc (FANS.TO) is 7.00%.

Range Selected
Cost of equity 8.50% - 10.50% 9.50%
Tax rate 2.80% - 3.60% 3.20%
Cost of debt 7.00% - 7.00% 7.00%
WACC 8.0% - 9.5% 8.8%
WACC

FANS.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 1.04 1.04
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.50% 10.50%
Tax rate 2.80% 3.60%
Debt/Equity ratio 0.34 0.34
Cost of debt 7.00% 7.00%
After-tax WACC 8.0% 9.5%
Selected WACC 8.8%

FANS.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 FANS.TO:

cost_of_equity (9.50%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.04) + 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.