ACP.V WACC - Weighted Average Cost of Capital
The WACC of ArcPacific Resources Corp (ACP.V) is 10.1%.
| Range | Selected | |
| Cost of equity | 8.8% - 11.8% | 10.3% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.6% - 11.6% | 10.1% |
| Category | Low | High |
| Long-term bond rate | 4.2% | 4.7% |
| Equity market risk premium | 5.5% | 6.5% |
| Adjusted beta | 0.84 | 1.02 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.8% | 11.8% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.03 | 0.03 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.6% | 11.6% |
| Selected WACC | 10.1% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ACP.V | ArcPacific Resources Corp | 0.03 | 0.96 | 0.94 |
| AAX.V | Advance Gold Corp | 0.03 | 1.15 | 1.13 |
| FTJ.V | Fort St James Nickel Corp | 0.11 | -0.02 | -0.02 |
| GGX.V | Ggx Gold Corp | 0.6 | -1.45 | -1.01 |
| IMI.V | International Millennium Mining Corp | 0.02 | 0.07 | 0.07 |
| KEN.V | Kenadyr Mining Corp | 0.14 | 1.78 | 1.61 |
| NXU.CN | Nexco Resources Inc | 0.59 | 1.09 | 0.76 |
| VBHI | Verde Bio Holdings Inc | 0.32 | 3.02 | 2.44 |
| VC.CN | Volatus Capital Corp | 0.15 | -3.45 | -3.11 |
| VKG.H.V | Troy Energy Corp | 0.12 | 4.18 | 3.84 |
| Low | High | |
| Unlevered beta | 0.48 | 1.02 |
| Relevered beta | 0.76 | 1.03 |
| Adjusted relevered beta | 0.84 | 1.02 |
ACP.V'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 ACP.V:
cost_of_equity (10.30%) = risk_free_rate (4.45%) + equity_risk_premium (6.00%) * adjusted_beta (0.84) + 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.