KUT.V WACC - Weighted Average Cost of Capital

The WACC of Redishred Capital Corp (Pre-Merger) (KUT.V) is 6.6%.

The Cost of Equity of Redishred Capital Corp (Pre-Merger) (KUT.V) is 7.20%.

The Cost of Debt of Redishred Capital Corp (Pre-Merger) (KUT.V) is 6.85%.

	Range	Selected
Cost of equity	5.60% - 8.80%	7.20%
Tax rate	26.20% - 27.00%	26.60%
Cost of debt	4.60% - 9.10%	6.85%
WACC	5.0% - 8.2%	6.6%

WACC

KUT.V WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.34	0.65

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.60%	8.80%

Tax rate	26.20%	27.00%
Debt/Equity ratio	0.39	0.39
Cost of debt	4.60%	9.10%

After-tax WACC	5.0%	8.2%


Selected WACC	6.6%

KUT.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 KUT.V:

cost_of_equity (7.20%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.34) + 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.