NPT.CN
Plaintree Systems Inc
Price:  
0.06 
CAD
Volume:  
5,015.00
Canada | Metals & Mining
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NPT.CN WACC - Weighted Average Cost of Capital

The WACC of Plaintree Systems Inc (NPT.CN) is 7.5%.

The Cost of Equity of Plaintree Systems Inc (NPT.CN) is 57.65%.
The Cost of Debt of Plaintree Systems Inc (NPT.CN) is 5.00%.

Range Selected
Cost of equity 26.30% - 89.00% 57.65%
Tax rate 3.50% - 8.80% 6.15%
Cost of debt 5.00% - 5.00% 5.00%
WACC 6.0% - 9.1% 7.5%
WACC

NPT.CN WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 4.55 13.9
Additional risk adjustments 0.0% 0.5%
Cost of equity 26.30% 89.00%
Tax rate 3.50% 8.80%
Debt/Equity ratio 17.61 17.61
Cost of debt 5.00% 5.00%
After-tax WACC 6.0% 9.1%
Selected WACC 7.5%

NPT.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 NPT.CN:

cost_of_equity (57.65%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (4.55) + 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.