IZ.V WACC - Weighted Average Cost of Capital
The WACC of International Zeolite Corp (IZ.V) is 7.0%.
| Range | Selected | |
| Cost of equity | 14.7% - 20.7% | 17.7% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 5.5% - 8.5% | 7.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 2.13 | 2.6 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 14.7% | 20.7% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 3.63 | 3.63 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 5.5% | 8.5% |
| Selected WACC | 7.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| IZ.V | International Zeolite Corp | 3.63 | -0.45 | -0.12 |
| BLIS | Treasure & Shipwreck Recovery Inc | 0.29 | 0.81 | 0.67 |
| QSMG | Quest Management Inc | 0.1 | 1.07 | 0.99 |
| Low | High | |
| Unlevered beta | 0.51 | 0.74 |
| Relevered beta | 2.69 | 3.39 |
| Adjusted relevered beta | 2.13 | 2.6 |
IZ.V'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 IZ.V:
cost_of_equity (17.70%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (2.13) + 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.