FCD.UN.TO
Firm Capital Property Trust
Price:  
5.97 
CAD
Volume:  
5,817.00
Canada | Equity Real Estate Investment Trusts (REITs)
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FCD.UN.TO WACC - Weighted Average Cost of Capital

The WACC of Firm Capital Property Trust (FCD.UN.TO) is 5.5%.

The Cost of Equity of Firm Capital Property Trust (FCD.UN.TO) is 8.10%.
The Cost of Debt of Firm Capital Property Trust (FCD.UN.TO) is 5.20%.

Range Selected
Cost of equity 6.40% - 9.80% 8.10%
Tax rate 25.90% - 26.50% 26.20%
Cost of debt 4.10% - 6.30% 5.20%
WACC 4.4% - 6.7% 5.5%
WACC

FCD.UN.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.64 0.92
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.40% 9.80%
Tax rate 25.90% 26.50%
Debt/Equity ratio 1.51 1.51
Cost of debt 4.10% 6.30%
After-tax WACC 4.4% 6.7%
Selected WACC 5.5%

FCD.UN.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 FCD.UN.TO:

cost_of_equity (8.10%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.64) + 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.