BEP.UN.TO
Brookfield Renewable Partners LP
Price:  
33.73 
CAD
Volume:  
62,016.00
Bermuda | Independent Power and Renewable Electricity Producers
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BEP.UN.TO WACC - Weighted Average Cost of Capital

The WACC of Brookfield Renewable Partners LP (BEP.UN.TO) is 7.5%.

The Cost of Equity of Brookfield Renewable Partners LP (BEP.UN.TO) is 7.40%.
The Cost of Debt of Brookfield Renewable Partners LP (BEP.UN.TO) is 12.75%.

Range Selected
Cost of equity 5.70% - 9.10% 7.40%
Tax rate 19.50% - 46.80% 33.15%
Cost of debt 5.30% - 20.20% 12.75%
WACC 4.5% - 10.5% 7.5%
WACC

BEP.UN.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.51 0.81
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.70% 9.10%
Tax rate 19.50% 46.80%
Debt/Equity ratio 5.1 5.1
Cost of debt 5.30% 20.20%
After-tax WACC 4.5% 10.5%
Selected WACC 7.5%

BEP.UN.TO'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 BEP.UN.TO:

cost_of_equity (7.40%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.51) + 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.