KAVL WACC - Weighted Average Cost of Capital
The WACC of Kaival Brands Innovations Group Inc (KAVL) is 9.4%.
| Range | Selected | |
| Cost of equity | 8.0% - 10.9% | 9.45% |
| Tax rate | 0.2% - 5.7% | 2.95% |
| Cost of debt | 7.0% - 7.0% | 7% |
| WACC | 8.0% - 10.8% | 9.4% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.9 | 1.08 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.0% | 10.9% |
| Tax rate | 0.2% | 5.7% |
| Debt/Equity ratio | 0.03 | 0.03 |
| Cost of debt | 7.0% | 7.0% |
| After-tax WACC | 8.0% | 10.8% |
| Selected WACC | 9.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| KAVL | Kaival Brands Innovations Group Inc | 0.03 | 1.72 | 1.67 |
| JAMF | Jamf Holding Corp | 0.24 | 1.06 | 0.85 |
| NCNO | nCino Inc | 0.08 | 1.54 | 1.43 |
| PSH.AS | Pershing Square Holdings Ltd | 0.25 | 0.99 | 0.8 |
| 950200.KQ | Psomagen Inc | 0.03 | 0.68 | 0.66 |
| Low | High | |
| Unlevered beta | 0.83 | 1.08 |
| Relevered beta | 0.85 | 1.12 |
| Adjusted relevered beta | 0.9 | 1.08 |
KAVL'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 KAVL:
cost_of_equity (9.45%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.9) + 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.