GDNS.CN WACC - Weighted Average Cost of Capital

The WACC of Goodness Growth Holdings Inc (GDNS.CN) is 9.7%.

The Cost of Equity of Goodness Growth Holdings Inc (GDNS.CN) is 7.85%.

The Cost of Debt of Goodness Growth Holdings Inc (GDNS.CN) is 14.25%.

	Range	Selected
Cost of equity	6.00% - 9.70%	7.85%
Tax rate	15.20% - 27.00%	21.10%
Cost of debt	8.30% - 20.20%	14.25%
WACC	6.6% - 12.8%	9.7%

WACC

GDNS.CN WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.56	0.91

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.00%	9.70%

Tax rate	15.20%	27.00%
Debt/Equity ratio	1.65	1.65
Cost of debt	8.30%	20.20%

After-tax WACC	6.6%	12.8%


Selected WACC	9.7%

GDNS.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 GDNS.CN:

cost_of_equity (7.85%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.56) + 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.