AZM.V WACC - Weighted Average Cost of Capital
The WACC of Azimut Exploration Inc (AZM.V) is 7.6%.
| Range | Selected | |
| Cost of equity | 6.5% - 8.8% | 7.65% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.5% - 8.8% | 7.6% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.52 | 0.64 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.5% | 8.8% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.5% | 8.8% |
| Selected WACC | 7.6% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| AZM.V | Azimut Exploration Inc | 0 | 1.14 | 1.13 |
| DNT.TO | Candente Copper Corp | 0.08 | 0.58 | 0.55 |
| EAM.V | East Africa Metals Inc | 0.03 | -0.47 | -0.46 |
| HI.V | Highland Copper Company Inc | 0.05 | 0.32 | 0.31 |
| LORD.V | St James Gold Corp | 0.18 | -0.21 | -0.18 |
| MAW.TO | Mawson Gold Ltd | 0.01 | 0.11 | 0.11 |
| MD.V | Midland Exploration Inc | 0 | 0.4 | 0.4 |
| SRG.V | SRG Mining Inc | 0 | 0.25 | 0.25 |
| TORQ.V | Torq Resources Inc | 0.22 | 0.93 | 0.8 |
| TSK.TO | Talisker Resources Ltd | 0.1 | 1.46 | 1.36 |
| Low | High | |
| Unlevered beta | 0.28 | 0.46 |
| Relevered beta | 0.28 | 0.46 |
| Adjusted relevered beta | 0.52 | 0.64 |
AZM.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 AZM.V:
cost_of_equity (7.65%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.52) + 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.