NXG.V WACC - Weighted Average Cost of Capital
The WACC of NexgenRx Inc (NXG.V) is 6.7%.
| Range | Selected | |
| Cost of equity | 5.7% - 7.9% | 6.8% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.7% - 7.8% | 6.7% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.37 | 0.5 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.7% | 7.9% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.03 | 0.03 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.7% | 7.8% |
| Selected WACC | 6.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| NXG.V | NexgenRx Inc | 0.03 | 1.06 | 1.04 |
| AOREF | American Overseas Group Ltd | 0.74 | 0.15 | 0.1 |
| BRP | BRP Group Inc | 0.34 | 0.95 | 0.76 |
| CUII | China United Insurance Service Inc | 6936.1 | -0.38 | 0 |
| EHTH | eHealth Inc | 0.51 | 0.6 | 0.43 |
| FANH | Fanhua Inc | 0.35 | -0.35 | -0.28 |
| FGF | Fundamental Global, Inc | 0.17 | -0.08 | -0.07 |
| GVFG | Gerova Financial Group Ltd | 0.56 | 1 | 0.71 |
| HUIZ | Huize Holding Ltd | 0.31 | 0.51 | 0.41 |
| WTG.L | Watchstone Group PLC | 0 | 0.13 | 0.13 |
| Low | High | |
| Unlevered beta | 0.12 | 0.42 |
| Relevered beta | 0.06 | 0.25 |
| Adjusted relevered beta | 0.37 | 0.5 |
NXG.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 NXG.V:
cost_of_equity (6.80%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.37) + 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.