NM.CN WACC - Weighted Average Cost of Capital

The WACC of Novamind Inc (NM.CN) is 7.9%.

The Cost of Equity of Novamind Inc (NM.CN) is 8.90%.

The Cost of Debt of Novamind Inc (NM.CN) is 5.00%.

	Range	Selected
Cost of equity	7.50% - 10.30%	8.90%
Tax rate	26.50% - 26.50%	26.50%
Cost of debt	5.00% - 5.00%	5.00%
WACC	6.7% - 9.0%	7.9%

WACC

NM.CN WACC calculation

Category	Low	High

Long-term bond rate	3.4%	3.9%
Equity market risk premium	4.7%	5.7%
Adjusted beta	0.87	1.04

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.50%	10.30%

Tax rate	26.50%	26.50%
Debt/Equity ratio	0.24	0.24
Cost of debt	5.00%	5.00%

After-tax WACC	6.7%	9.0%


Selected WACC	7.9%

NM.CN'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 NM.CN:

cost_of_equity (8.90%) = risk_free_rate (3.65%) + equity_risk_premium (5.20%) * adjusted_beta (0.87) + 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.