XRX.CN
XORTX Therapeutics Inc
Price:  
1.9 
CAD
Volume:  
111,400
Canada | Professional, Scientific, and Technical Services

XRX.CN WACC - Weighted Average Cost of Capital

The WACC of XORTX Therapeutics Inc (XRX.CN) is 7.7%.

The Cost of Equity of XORTX Therapeutics Inc (XRX.CN) is 11.65%.
The Cost of Debt of XORTX Therapeutics Inc (XRX.CN) is 5%.

RangeSelected
Cost of equity10.0% - 13.3%11.65%
Tax rate26.5% - 26.5%26.5%
Cost of debt5.0% - 5.0%5%
WACC6.8% - 8.5%7.7%
WACC

XRX.CN WACC calculation

CategoryLowHigh
Long-term bond rate3.4%3.9%
Equity market risk premium4.7%5.7%
Adjusted beta1.391.56
Additional risk adjustments0.0%0.5%
Cost of equity10.0%13.3%
Tax rate26.5%26.5%
Debt/Equity ratio
11
Cost of debt5.0%5.0%
After-tax WACC6.8%8.5%
Selected WACC7.7%

XRX.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 XRX.CN:

cost_of_equity (11.65%) = risk_free_rate (3.65%) + equity_risk_premium (5.20%) * adjusted_beta (1.39) + 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.