NFI.TO
NFI Group Inc
Price:  
18.44 
CAD
Volume:  
211,060.00
Canada | Machinery
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NFI.TO WACC - Weighted Average Cost of Capital

The WACC of NFI Group Inc (NFI.TO) is 10.5%.

The Cost of Equity of NFI Group Inc (NFI.TO) is 10.50%.
The Cost of Debt of NFI Group Inc (NFI.TO) is 13.90%.

Range Selected
Cost of equity 8.70% - 12.30% 10.50%
Tax rate 17.50% - 27.90% 22.70%
Cost of debt 7.60% - 20.20% 13.90%
WACC 7.7% - 13.3% 10.5%
WACC

NFI.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 1.09 1.34
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.70% 12.30%
Tax rate 17.50% 27.90%
Debt/Equity ratio 0.74 0.74
Cost of debt 7.60% 20.20%
After-tax WACC 7.7% 13.3%
Selected WACC 10.5%

NFI.TO'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 NFI.TO:

cost_of_equity (10.50%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.09) + 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.