THC.CN
THC Biomed Intl Ltd
Price:  
0.02 
CAD
Volume:  
16,652
Canada | Pharmaceuticals

THC.CN WACC - Weighted Average Cost of Capital

The WACC of THC Biomed Intl Ltd (THC.CN) is 4.2%.

The Cost of Equity of THC Biomed Intl Ltd (THC.CN) is 5.7%.
The Cost of Debt of THC Biomed Intl Ltd (THC.CN) is 5%.

RangeSelected
Cost of equity4.5% - 6.9%5.7%
Tax rate25.9% - 26.5%26.2%
Cost of debt5.0% - 5.0%5%
WACC3.9% - 4.5%4.2%
WACC

THC.CN WACC calculation

CategoryLowHigh
Long-term bond rate3.2%3.7%
Equity market risk premium5.1%6.1%
Adjusted beta0.250.45
Additional risk adjustments0.0%0.5%
Cost of equity4.5%6.9%
Tax rate25.9%26.5%
Debt/Equity ratio
2.742.74
Cost of debt5.0%5.0%
After-tax WACC3.9%4.5%
Selected WACC4.2%

THC.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 THC.CN:

cost_of_equity (5.70%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.25) + 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.