The WACC of Home Bistro Inc (HBIS) is 5.3%.
Range | Selected | |
Cost of equity | 1060.3% - 3532.5% | 2296.4% |
Tax rate | 26.2% - 27.0% | 26.6% |
Cost of debt | 7.0% - 7.0% | 7% |
WACC | 5.2% - 5.4% | 5.3% |
Category | Low | High |
Long-term bond rate | 3.9% | 4.4% |
Equity market risk premium | 4.6% | 5.6% |
Adjusted beta | 229.65 | 629.94 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 1060.3% | 3532.5% |
Tax rate | 26.2% | 27.0% |
Debt/Equity ratio | 13128.37 | 13128.37 |
Cost of debt | 7.0% | 7.0% |
After-tax WACC | 5.2% | 5.4% |
Selected WACC | 5.3% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
HBIS | Home Bistro Inc | 13128.37 | -35.03 | 0 |
AMNF | Armanino Foods Of Distinction Inc | 0.01 | 0.06 | 0.06 |
BGA.V | BioNeutra Global Corp | 5.48 | 0.3 | 0.06 |
CUBV | CUBA Beverage Co | 0.17 | -0.09 | -0.08 |
GB.V | Ginger Beef Corp | 0.38 | 0.19 | 0.15 |
GLG.TO | Glg Life Tech Corp | 33.27 | -0.49 | -0.02 |
HCEI | Healthy Coffee International Inc | 0.03 | 0 | 0 |
MMMB | MamaMancini's Holdings Inc | 0.07 | 0.42 | 0.4 |
NUZE | NuZee Inc | 0 | -1.24 | -1.23 |
RMCF | Rocky Mountain Chocolate Factory Inc (Delaware) | 0.5 | 0.34 | 0.25 |
SOWG | Sow Good Inc | 0.27 | 1.8 | 1.5 |
Low | High | |
Unlevered beta | 0 | 0.06 |
Relevered beta | 342.27 | 939.72 |
Adjusted relevered beta | 229.65 | 629.94 |
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 HBIS:
cost_of_equity (2,296.40%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (229.65) + 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.