QHYG WACC - Weighted Average Cost of Capital
The WACC of QHY Group (QHYG) is 7.1%.
| Range | Selected | |
| Cost of equity | 5.9% - 8.6% | 7.25% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.8% - 8.5% | 7.1% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.44 | 0.67 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.9% | 8.6% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.03 | 0.03 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.8% | 8.5% |
| Selected WACC | 7.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| QHYG | QHY Group | 0.03 | 3.55 | 3.46 |
| BAC.CN | Bactech Environmental Corp | 0.15 | -1.19 | -1.07 |
| BQE.V | BQE Water Inc | 0.03 | 0.4 | 0.39 |
| CCTC | Clean Coal Technologies Inc | 0.99 | 1.48 | 0.86 |
| ETK.H.V | Envirotek Remediation Inc | 0.22 | 1.09 | 0.94 |
| EWK.V | Earthworks Industries Inc | 0.86 | -0.18 | -0.11 |
| GARB | Garb Oil & Power Corp | 72.4 | 0 | 0 |
| GEVI | General Environmental Management Inc | 0.01 | 0.65 | 0.65 |
| NNRI | NNRF Inc | 0.05 | 1.86 | 1.79 |
| NUGL | NUGL Inc | 0.02 | -1.15 | -1.13 |
| SRCL | Stericycle Inc | 0.23 | 0.3 | 0.26 |
| Low | High | |
| Unlevered beta | 0.26 | 0.65 |
| Relevered beta | 0.16 | 0.51 |
| Adjusted relevered beta | 0.44 | 0.67 |
QHYG'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 QHYG:
cost_of_equity (7.25%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.44) + 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.