The WACC of Cadillac Ventures Inc (CDC.V) is 7.6%.
Range | Selected | |
Cost of equity | 6.6% - 10.5% | 8.55% |
Tax rate | 27.0% - 27.0% | 27% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 6.1% - 9.2% | 7.6% |
Category | Low | High |
Long-term bond rate | 3.2% | 3.7% |
Equity market risk premium | 4.7% | 5.7% |
Adjusted beta | 0.73 | 1.1 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.6% | 10.5% |
Tax rate | 27.0% | 27.0% |
Debt/Equity ratio | 0.23 | 0.23 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 6.1% | 9.2% |
Selected WACC | 7.6% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
CDC.V | Cadillac Ventures Inc | 0.23 | 1.59 | 1.36 |
AVM.X.CN | Avarone Metals Inc | 0.45 | 3.64 | 2.75 |
AVU.V | Avrupa Minerals Ltd | 0.97 | 1.78 | 1.04 |
BMIN | Britannia Mining Inc | 0.01 | 0.58 | 0.58 |
PBM.V | Pacific Bay Minerals Ltd | 0.01 | 2.37 | 2.36 |
SFX.V | Sphinx Resources Ltd | 0.03 | 0.4 | 0.39 |
SUPR.V | Supernova Metals Corp | 0.02 | 1.55 | 1.52 |
SXL.V | Slam Exploration Ltd | 0.01 | -1.13 | -1.13 |
TRS.V | Tres-Or Resources Ltd | 0.01 | -0.7 | -0.7 |
TTS.V | Tintina Mines Ltd | 0.11 | 2.3 | 2.13 |
Low | High | |
Unlevered beta | 0.86 | 1.43 |
Relevered beta | 0.6 | 1.15 |
Adjusted relevered beta | 0.73 | 1.1 |
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 CDC.V:
cost_of_equity (8.55%) = risk_free_rate (3.45%) + equity_risk_premium (5.20%) * adjusted_beta (0.73) + 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.