CTGO
Contango ORE Inc
Price:  
14.28 
USD
Volume:  
81,899.00
United States | Metals & Mining
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CTGO WACC - Weighted Average Cost of Capital

The WACC of Contango ORE Inc (CTGO) is 8.9%.

The Cost of Equity of Contango ORE Inc (CTGO) is 10.45%.
The Cost of Debt of Contango ORE Inc (CTGO) is 5.00%.

Range Selected
Cost of equity 8.70% - 12.20% 10.45%
Tax rate 0.10% - 0.30% 0.20%
Cost of debt 5.00% - 5.00% 5.00%
WACC 7.6% - 10.1% 8.9%
WACC

CTGO WACC calculation

Category Low High
Long-term bond rate 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 1.05 1.31
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.70% 12.20%
Tax rate 0.10% 0.30%
Debt/Equity ratio 0.41 0.41
Cost of debt 5.00% 5.00%
After-tax WACC 7.6% 10.1%
Selected WACC 8.9%

CTGO'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 CTGO:

cost_of_equity (10.45%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.05) + 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.