FONE.CN WACC - Weighted Average Cost of Capital
The WACC of Flower One Holdings Inc (FONE.CN) is 5.4%.
| Range | Selected | |
| Cost of equity | 17.6% - 38.7% | 28.15% |
| Tax rate | 0.4% - 2.1% | 1.25% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.2% - 5.5% | 5.4% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 2.82 | 5.66 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 17.6% | 38.7% |
| Tax rate | 0.4% | 2.1% |
| Debt/Equity ratio | 53.27 | 53.27 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.2% | 5.5% |
| Selected WACC | 5.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| FONE.CN | Flower One Holdings Inc | 53.27 | 1.84 | 0.03 |
| ALID | Allied Corp | 5.05 | -0.37 | -0.06 |
| ASP.TO | Acerus Pharmaceuticals Corporation | 11.65 | 1.14 | 0.09 |
| BAMM.CN | Body and Mind Inc | 4.02 | 0.18 | 0.04 |
| COOL.CN | Core One Labs Inc | 0.04 | 0.14 | 0.13 |
| EBM.V | Eastwood Bio-Medical Canada Inc | 0 | -1.14 | -1.13 |
| FLWR.V | Flowr Corp | 2.08 | 0.52 | 0.17 |
| KHRN.V | Khiron Life Sciences Corp | 0.31 | 1.83 | 1.4 |
| PRPH | Prophase Labs Inc | 1.11 | 1.87 | 0.89 |
| RX.V | Biosyent Inc | 0.01 | 0.59 | 0.59 |
| Low | High | |
| Unlevered beta | 0.07 | 0.15 |
| Relevered beta | 3.72 | 7.96 |
| Adjusted relevered beta | 2.82 | 5.66 |
FONE.CN'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 FONE.CN:
cost_of_equity (28.15%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (2.82) + 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.