RSTN WACC - Weighted Average Cost of Capital
The WACC of RDE Inc (RSTN) is 7.0%.
| Range | Selected | |
| Cost of equity | 5.9% - 8.3% | 7.1% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 6.2% - 7.0% | 6.6% |
| WACC | 5.8% - 8.1% | 7.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.44 | 0.62 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.9% | 8.3% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.07 | 0.07 |
| Cost of debt | 6.2% | 7.0% |
| After-tax WACC | 5.8% | 8.1% |
| Selected WACC | 7.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| RSTN | RDE Inc | 0.07 | 0.46 | 0.44 |
| BQ | Boqii Holding Ltd | 1.17 | 2.17 | 1.17 |
| FOOD.TO | Goodfood Market Corp | 4.33 | 1.61 | 0.39 |
| HEWA | HealthWarehouse.com Inc | 0.64 | -0.07 | -0.05 |
| KITS.TO | Kits Eyecare Ltd | 0.03 | 1.13 | 1.1 |
| MOHO | Ecmoho Ltd | 1.23 | 0.93 | 0.49 |
| RUHN | Ruhnn Holding Ltd | 0.01 | 1.07 | 1.07 |
| UXIN | Uxin Ltd | 0.13 | 1.18 | 1.07 |
| WNW | Wunong Net Technology Co Ltd | 1.03 | 0.82 | 0.47 |
| Low | High | |
| Unlevered beta | 0.47 | 0.95 |
| Relevered beta | 0.16 | 0.43 |
| Adjusted relevered beta | 0.44 | 0.62 |
RSTN'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 RSTN:
cost_of_equity (7.10%) = 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.