BTE.TO WACC - Weighted Average Cost of Capital

The WACC of Baytex Energy Corp (BTE.TO) is 7.3%.

The Cost of Equity of Baytex Energy Corp (BTE.TO) is 8.95%.

The Cost of Debt of Baytex Energy Corp (BTE.TO) is 6.95%.

	Range	Selected
Cost of equity	5.10% - 12.80%	8.95%
Tax rate	5.60% - 18.30%	11.95%
Cost of debt	4.90% - 9.00%	6.95%
WACC	4.8% - 9.7%	7.3%

WACC

BTE.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.38	1.42

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.10%	12.80%

Tax rate	5.60%	18.30%
Debt/Equity ratio	1.29	1.29
Cost of debt	4.90%	9.00%

After-tax WACC	4.8%	9.7%


Selected WACC	7.3%

BTE.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 BTE.TO:

cost_of_equity (8.95%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.38) + 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.