CSW.A.TO WACC - Weighted Average Cost of Capital

The WACC of Corby Spirit and Wine Ltd (CSW.A.TO) is 5.6%.

The Cost of Equity of Corby Spirit and Wine Ltd (CSW.A.TO) is 6.45%.

The Cost of Debt of Corby Spirit and Wine Ltd (CSW.A.TO) is 4.45%.

	Range	Selected
Cost of equity	5.10% - 7.80%	6.45%
Tax rate	26.90% - 27.10%	27.00%
Cost of debt	4.00% - 4.90%	4.45%
WACC	4.5% - 6.7%	5.6%

WACC

CSW.A.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	0.6

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.10%	7.80%

Tax rate	26.90%	27.10%
Debt/Equity ratio	0.36	0.36
Cost of debt	4.00%	4.90%

After-tax WACC	4.5%	6.7%


Selected WACC	5.6%

CSW.A.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 CSW.A.TO:

cost_of_equity (6.45%) = 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.