PRME.CN
Prime Drink Group Corp
Price:  
0.13 
CAD
Volume:  
273,550
Canada | Utilities

PRME.CN WACC - Weighted Average Cost of Capital

The WACC of Prime Drink Group Corp (PRME.CN) is 9.8%.

The Cost of Equity of Prime Drink Group Corp (PRME.CN) is 15.9%.
The Cost of Debt of Prime Drink Group Corp (PRME.CN) is 5%.

RangeSelected
Cost of equity14.3% - 17.5%15.9%
Tax rate25.9% - 26.5%26.2%
Cost of debt5.0% - 5.0%5%
WACC9.0% - 10.6%9.8%
WACC

PRME.CN WACC calculation

CategoryLowHigh
Long-term bond rate3.2%3.7%
Equity market risk premium5.1%6.1%
Adjusted beta2.192.19
Additional risk adjustments0.0%0.5%
Cost of equity14.3%17.5%
Tax rate25.9%26.5%
Debt/Equity ratio
11
Cost of debt5.0%5.0%
After-tax WACC9.0%10.6%
Selected WACC9.8%

PRME.CN WACC - Detailed calculations of Beta

Debt/EquityUnlevered
PeersCompany NameratioBetabeta
PRME.CNPrime Drink Group Corp0.951.610.95
LowHigh
Unlevered beta0.950.95
Relevered beta2.782.78
Adjusted relevered beta2.192.19

PRME.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 PRME.CN:

cost_of_equity (15.90%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (2.19) + 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.