PVT.V WACC - Weighted Average Cost of Capital
The WACC of Pivotree Inc (PVT.V) is 8.5%.
| Range | Selected | |
| Cost of equity | 7.5% - 9.5% | 8.5% |
| Tax rate | 6.0% - 8.4% | 7.2% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.5% - 9.4% | 8.5% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.72 | 0.76 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.5% | 9.5% |
| Tax rate | 6.0% | 8.4% |
| Debt/Equity ratio | 0.01 | 0.01 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.5% | 9.4% |
| Selected WACC | 8.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PVT.V | Pivotree Inc | 0.01 | 0.09 | 0.08 |
| CGI.TO | Canadian General Investments Ltd | 0.26 | 1.2 | 0.97 |
| CYB.TO | Cymbria Corp | 0.04 | 0.67 | 0.65 |
| DND.TO | Dye & Durham Ltd | 2.27 | 1.93 | 0.63 |
| PGI.UN.TO | PIMCO Global Income Opportunities Fund | 0.45 | 0.71 | 0.5 |
| Low | High | |
| Unlevered beta | 0.58 | 0.63 |
| Relevered beta | 0.58 | 0.64 |
| Adjusted relevered beta | 0.72 | 0.76 |
PVT.V'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 PVT.V:
cost_of_equity (8.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.72) + 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.