The WACC of Blackrock Silver Corp (BRC.V) is 9.5%.
Range | Selected | |
Cost of equity | 8.3% - 10.7% | 9.5% |
Tax rate | 26.2% - 27.0% | 26.6% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 8.3% - 10.7% | 9.5% |
Category | Low | High |
Long-term bond rate | 3.9% | 4.4% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 0.88 | 0.96 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 8.3% | 10.7% |
Tax rate | 26.2% | 27.0% |
Debt/Equity ratio | 0 | 0 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 8.3% | 10.7% |
Selected WACC | 9.5% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
BRC.V | Blackrock Silver Corp | 0 | 2.34 | 2.33 |
AVL.TO | Avalon Advanced Materials Inc | 0.38 | 1.85 | 1.45 |
AZM.V | Azimut Exploration Inc | 0 | 0.92 | 0.92 |
ESM.TO | Euro Sun Mining Inc | 0.01 | 0.67 | 0.66 |
FT.TO | Fortune Minerals Ltd | 0.37 | 1 | 0.79 |
INV.TO | INV Metals Inc | 0.01 | 1.94 | 1.93 |
NKL.V | Nickel 28 Capital Corp | 0.72 | 1.57 | 1.03 |
OM.V | Osisko Metals Inc | 0.2 | 0.96 | 0.83 |
SANP | Santo Mining Corp | 82.59 | 0 | 0 |
TSK.TO | Talisker Resources Ltd | 0.07 | 1.23 | 1.17 |
UCU.V | Ucore Rare Metals Inc | 0.18 | 0.55 | 0.49 |
Low | High | |
Unlevered beta | 0.83 | 1.03 |
Relevered beta | 0.82 | 0.94 |
Adjusted relevered beta | 0.88 | 0.96 |
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 BRC.V:
cost_of_equity (9.50%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.88) + 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.