ONTX WACC - Weighted Average Cost of Capital
The WACC of Onconova Therapeutics Inc (ONTX) is 5.3%.
| Range | Selected | |
| Cost of equity | 5.9% - 7.9% | 6.9% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.8% - 5.8% | 5.3% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.43 | 0.53 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.9% | 7.9% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.8% | 5.8% |
| Selected WACC | 5.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ONTX | Onconova Therapeutics Inc | 1.15 | 1.52 | 0.83 |
| BMY | Bristol-Myers Squibb Co | 0.52 | 0.13 | 0.1 |
| CLVR | Clever Leaves Holdings Inc | 1735.04 | 224417.62 | 177.04 |
| EVFM | Evofem Biosciences Inc | 43.99 | -0.13 | 0 |
| IMCC.CN | IM Cannabis Corp | 2.57 | 1.2 | 0.42 |
| INLB | Item 9 Labs Corp | 38316.48 | -0.37 | 0 |
| JAGX | Jaguar Health Inc | 9.02 | 3.4 | 0.45 |
| MRK | Merck & Co Inc | 0.19 | 0.48 | 0.42 |
| NOVN | Novan Inc | 3.91 | 1.44 | 0.37 |
| SLNG.CN | Slang Worldwide Inc | 26.06 | 0.53 | 0.03 |
| SOL.CN | SOL Global Investments Corp | 3.65 | 2.65 | 0.72 |
| Low | High | |
| Unlevered beta | 0.37 | 0.42 |
| Relevered beta | 0.15 | 0.3 |
| Adjusted relevered beta | 0.43 | 0.53 |
ONTX'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 ONTX:
cost_of_equity (6.90%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.43) + 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.