IFA.TO
iFabric Corp
Price:  
0.96 
CAD
Volume:  
3,000.00
Canada | Textiles, Apparel & Luxury Goods
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IFA.TO WACC - Weighted Average Cost of Capital

The WACC of iFabric Corp (IFA.TO) is 6.1%.

The Cost of Equity of iFabric Corp (IFA.TO) is 6.25%.
The Cost of Debt of iFabric Corp (IFA.TO) is 5.00%.

Range Selected
Cost of equity 5.30% - 7.20% 6.25%
Tax rate 21.10% - 25.70% 23.40%
Cost of debt 5.00% - 5.00% 5.00%
WACC 5.2% - 6.9% 6.1%
WACC

IFA.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.42 0.49
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.30% 7.20%
Tax rate 21.10% 25.70%
Debt/Equity ratio 0.07 0.07
Cost of debt 5.00% 5.00%
After-tax WACC 5.2% 6.9%
Selected WACC 6.1%

IFA.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 IFA.TO:

cost_of_equity (6.25%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.42) + 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.