INO.UN.TO
Inovalis Real Estate Investment Trust
Price:  
0.92 
CAD
Volume:  
9,400.00
Canada | Equity Real Estate Investment Trusts (REITs)
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INO.UN.TO WACC - Weighted Average Cost of Capital

The WACC of Inovalis Real Estate Investment Trust (INO.UN.TO) is 9.2%.

The Cost of Equity of Inovalis Real Estate Investment Trust (INO.UN.TO) is 8.50%.
The Cost of Debt of Inovalis Real Estate Investment Trust (INO.UN.TO) is 9.45%.

Range Selected
Cost of equity 7.30% - 9.70% 8.50%
Tax rate 1.40% - 1.80% 1.60%
Cost of debt 4.00% - 14.90% 9.45%
WACC 4.4% - 14.1% 9.2%
WACC

INO.UN.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.8 0.91
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.30% 9.70%
Tax rate 1.40% 1.80%
Debt/Equity ratio 7.05 7.05
Cost of debt 4.00% 14.90%
After-tax WACC 4.4% 14.1%
Selected WACC 9.2%

INO.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 INO.UN.TO:

cost_of_equity (8.50%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.8) + 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.