REVO.V WACC - Weighted Average Cost of Capital
The WACC of RevoluGROUP Canada Inc (REVO.V) is 32.0%.
| Range | Selected | |
| Cost of equity | 7.4% - 11.2% | 9.3% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 74.6% - 74.6% | 74.6% |
| WACC | 31.2% - 32.8% | 32.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.7 | 1.04 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.4% | 11.2% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 74.6% | 74.6% |
| After-tax WACC | 31.2% | 32.8% |
| Selected WACC | 32.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| REVO.V | RevoluGROUP Canada Inc | 0.81 | 2.54 | 1.6 |
| BKNG | Booking Holdings Inc | 0.1 | 1.13 | 1.05 |
| CANG | Cango Inc | 0.36 | 0.43 | 0.34 |
| DESP | Despegar.com Corp | 0.03 | 0.63 | 0.61 |
| EXPE | Expedia Group Inc | 0.29 | 1.4 | 1.15 |
| HOC.V | Hunter Technology Corp | 2.44 | -0.78 | -0.28 |
| SCGY | Scientific Energy Inc | 0.01 | 0.28 | 0.28 |
| TCOM | Trip.com Group Ltd | 0.22 | 1.25 | 1.07 |
| VTEQ | Veriteq Corp | 125.5 | 1.01 | 0.01 |
| YTRA | Yatra Online Inc | 0.19 | 0.7 | 0.61 |
| HAPPY.CO | Happy Helper A/S | 1.68 | -0.48 | -0.21 |
| Low | High | |
| Unlevered beta | 0.34 | 0.61 |
| Relevered beta | 0.55 | 1.06 |
| Adjusted relevered beta | 0.7 | 1.04 |
REVO.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 REVO.V:
cost_of_equity (9.30%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.7) + 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.