The cost of equity in Canad

Therefore, in this paper, I calculate the implied cost of equity for non- financial firms across 19 developed countries to determine the characteristics that affect the cost of equity and to provide a broader range of benchmarks for which to compare Canada’s cost of equity. [...] After controlling for the characteristics of firms that analysts choose to cover in each country, differences in the properties of analyst forecasts across countries, and differences in accounting standards across countries, Canada’s cost of equity is statistically different from a handful of countries and the magnitudes of these differences are economically significant. [...] They examine the relation between a firm’s cost of equity and its voluntary disclosure levels, which is measured as the difference between the firm’s CIFAR score (a measure of disclosure in the firm’s annual reports) and the minimum CIFAR score in the firm’s country. [...] Under the Gordon model, the country cost of equity is calculated as the sum of the stock index’s dividend yield and the growth rate in its dividends, which is typically measured using the index’s historical dividend growth rate. [...] Few of the international studies on the implied cost of equity provide country cost of equity estimates and, moreover, the cost of equity estimates by country vary across studies, given that these studies cover a different time period, include a different sample of firms in their analysis, and calculate the cost of equity using different methods and in different currencies (i.e., local currency vs