NLSP WACC - Weighted Average Cost of Capital
The WACC of NLS Pharmaceutics AG (NLSP) is 7.5%.
| Range | Selected | |
| Cost of equity | 6.2% - 12.0% | 9.1% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.5% - 9.6% | 7.5% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.51 | 1.28 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.2% | 12.0% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.4 | 0.4 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.5% | 9.6% |
| Selected WACC | 7.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| NLSP | NLS Pharmaceutics AG | 0.4 | 0.02 | 0.01 |
| ACER | Acer Therapeutics Inc | 0.72 | 0.43 | 0.28 |
| AVCN.TO | Avicanna Inc | 0.07 | 1.88 | 1.79 |
| AXIM | Axim Biotechnologies Inc | 2.44 | 0.22 | 0.08 |
| CNBX | Cannabics Pharmaceuticals Inc | 154.18 | 0.19 | 0 |
| EARS | Auris Medical Holding Ltd | 0.01 | 1.42 | 1.4 |
| NBRV | Nabriva Therapeutics PLC | 1.15 | 1.64 | 0.89 |
| RVPH | Reviva Pharmaceuticals Holdings, Inc. | 0.01 | 2.05 | 2.03 |
| TRVI | Trevi Therapeutics Inc | 0 | -0.11 | -0.11 |
| VIFN.SW | Vifor Pharma AG | 0.05 | 1.61 | 1.54 |
| Low | High | |
| Unlevered beta | 0.2 | 1.1 |
| Relevered beta | 0.27 | 1.42 |
| Adjusted relevered beta | 0.51 | 1.28 |
NLSP'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 NLSP:
cost_of_equity (9.10%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.51) + 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.