FCD.UN.TO
Firm Capital Property Trust
Price:  
6.04 
CAD
Volume:  
5,817
Canada | Equity Real Estate Investment Trusts (REITs)

FCD.UN.TO WACC - Weighted Average Cost of Capital

The WACC of Firm Capital Property Trust (FCD.UN.TO) is 5.6%.

The Cost of Equity of Firm Capital Property Trust (FCD.UN.TO) is 8.05%.
The Cost of Debt of Firm Capital Property Trust (FCD.UN.TO) is 5.45%.

RangeSelected
Cost of equity6.4% - 9.7%8.05%
Tax rate25.9% - 26.5%26.2%
Cost of debt4.1% - 6.8%5.45%
WACC4.4% - 6.9%5.6%
WACC

FCD.UN.TO WACC calculation

CategoryLowHigh
Long-term bond rate3.2%3.7%
Equity market risk premium5.1%6.1%
Adjusted beta0.640.9
Additional risk adjustments0.0%0.5%
Cost of equity6.4%9.7%
Tax rate25.9%26.5%
Debt/Equity ratio
1.51.5
Cost of debt4.1%6.8%
After-tax WACC4.4%6.9%
Selected WACC5.6%

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 (8.05%) = 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.