VAI.CN
VirtualArmour International Inc
Price:  
0.01 
CAD
Volume:  
185,670.00
United States | N/A
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VAI.CN WACC - Weighted Average Cost of Capital

The WACC of VirtualArmour International Inc (VAI.CN) is 8.6%.

The Cost of Equity of VirtualArmour International Inc (VAI.CN) is 6.15%.
The Cost of Debt of VirtualArmour International Inc (VAI.CN) is 31.20%.

Range Selected
Cost of equity 5.40% - 6.90% 6.15%
Tax rate 26.50% - 26.50% 26.50%
Cost of debt 7.00% - 55.40% 31.20%
WACC 5.4% - 11.9% 8.6%
WACC

VAI.CN WACC calculation

Category Low High
Long-term bond rate 3.4% 3.9%
Equity market risk premium 4.7% 5.7%
Adjusted beta 0.33 0.36
Additional risk adjustments 0.5% 1.0%
Cost of equity 5.40% 6.90%
Tax rate 26.50% 26.50%
Debt/Equity ratio 0.17 0.17
Cost of debt 7.00% 55.40%
After-tax WACC 5.4% 11.9%
Selected WACC 8.6%

VAI.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 VAI.CN:

cost_of_equity (6.15%) = risk_free_rate (3.65%) + equity_risk_premium (5.20%) * adjusted_beta (0.33) + risk_adjustments (0.75%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.