PLTH.CN WACC - Weighted Average Cost of Capital

The WACC of Planet 13 Holdings Inc (PLTH.CN) is 20.2%.

The Cost of Equity of Planet 13 Holdings Inc (PLTH.CN) is 6.90%.

The Cost of Debt of Planet 13 Holdings Inc (PLTH.CN) is 256.30%.

	Range	Selected
Cost of equity	5.80% - 8.00%	6.90%
Tax rate	28.00% - 36.40%	32.20%
Cost of debt	7.00% - 505.60%	256.30%
WACC	5.8% - 34.6%	20.2%

WACC

PLTH.CN WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.52	0.63

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.80%	8.00%

Tax rate	28.00%	36.40%
Debt/Equity ratio	0.09	0.09
Cost of debt	7.00%	505.60%

After-tax WACC	5.8%	34.6%


Selected WACC	20.2%

PLTH.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 PLTH.CN:

cost_of_equity (6.90%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.52) + 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.