POSC WACC - Weighted Average Cost of Capital
The WACC of Positron Corp (POSC) is 6.5%.
| Range | Selected | |
| Cost of equity | 5.3% - 7.7% | 6.5% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 7.0% - 7.0% | 7% |
| WACC | 5.3% - 7.6% | 6.5% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.31 | 0.51 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.3% | 7.7% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.02 | 0.02 |
| Cost of debt | 7.0% | 7.0% |
| After-tax WACC | 5.3% | 7.6% |
| Selected WACC | 6.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| POSC | Positron Corp | 0.02 | 0.44 | 0.43 |
| BINP | Bionoid Pharma Inc | 0.05 | -0.26 | -0.25 |
| IME.CN | Imagin Medical Inc | 48.47 | -2.03 | -0.06 |
| MZEIQ | Medizone International Inc | 0.79 | -0.55 | -0.35 |
| PAVM | PAVmed Inc | 2.5 | 1.77 | 0.63 |
| RMSL | REMSleep Holdings Inc | 0 | 0.85 | 0.85 |
| Low | High | |
| Unlevered beta | -0.06 | 0.43 |
| Relevered beta | -0.03 | 0.27 |
| Adjusted relevered beta | 0.31 | 0.51 |
POSC'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 POSC:
cost_of_equity (6.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.31) + 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.