PBIT.CN
POSaBIT Systems Corp
Price:  
0.10 
CAD
Volume:  
14,435.00
United States | N/A
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PBIT.CN WACC - Weighted Average Cost of Capital

The WACC of POSaBIT Systems Corp (PBIT.CN) is 14.1%.

The Cost of Equity of POSaBIT Systems Corp (PBIT.CN) is 6.65%.
The Cost of Debt of POSaBIT Systems Corp (PBIT.CN) is 31.55%.

Range Selected
Cost of equity 5.30% - 8.00% 6.65%
Tax rate 0.10% - 0.80% 0.45%
Cost of debt 7.00% - 56.10% 31.55%
WACC 5.8% - 22.4% 14.1%
WACC

PBIT.CN WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.42 0.63
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.30% 8.00%
Tax rate 0.10% 0.80%
Debt/Equity ratio 0.43 0.43
Cost of debt 7.00% 56.10%
After-tax WACC 5.8% 22.4%
Selected WACC 14.1%

PBIT.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 PBIT.CN:

cost_of_equity (6.65%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.42) + 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.