NFD.A.V WACC - Weighted Average Cost of Capital

The WACC of Northfield Capital Corp (NFD.A.V) is 8.2%.

The Cost of Equity of Northfield Capital Corp (NFD.A.V) is 7.50%.

The Cost of Debt of Northfield Capital Corp (NFD.A.V) is 13.95%.

	Range	Selected
Cost of equity	6.40% - 8.60%	7.50%
Tax rate	2.60% - 3.60%	3.10%
Cost of debt	4.00% - 23.90%	13.95%
WACC	6.1% - 10.3%	8.2%

WACC

NFD.A.V WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.5	0.62

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.40%	8.60%

Tax rate	2.60%	3.60%
Debt/Equity ratio	0.13	0.13
Cost of debt	4.00%	23.90%

After-tax WACC	6.1%	10.3%


Selected WACC	8.2%

NFD.A.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 NFD.A.V:

cost_of_equity (7.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.5) + 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.