IONC.CN
Ionic Brands Corp
Price:  
0.01 
CAD
Volume:  
21,480.00
Canada | Tobacco
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IONC.CN WACC - Weighted Average Cost of Capital

The WACC of Ionic Brands Corp (IONC.CN) is 4.8%.

The Cost of Equity of Ionic Brands Corp (IONC.CN) is 45.20%.
The Cost of Debt of Ionic Brands Corp (IONC.CN) is 5.00%.

Range Selected
Cost of equity 15.00% - 75.40% 45.20%
Tax rate 25.90% - 26.50% 26.20%
Cost of debt 5.00% - 5.00% 5.00%
WACC 4.0% - 5.6% 4.8%
WACC

IONC.CN WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 2.33 11.68
Additional risk adjustments 0.0% 0.5%
Cost of equity 15.00% 75.40%
Tax rate 25.90% 26.50%
Debt/Equity ratio 35.88 35.88
Cost of debt 5.00% 5.00%
After-tax WACC 4.0% 5.6%
Selected WACC 4.8%

IONC.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 IONC.CN:

cost_of_equity (45.20%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (2.33) + 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.