DTOL.TO
D2L Inc
Price:  
13.64 
CAD
Volume:  
2,148.00
Canada | Diversified Consumer Services
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DTOL.TO WACC - Weighted Average Cost of Capital

The WACC of D2L Inc (DTOL.TO) is 5.9%.

The Cost of Equity of D2L Inc (DTOL.TO) is 5.95%.
The Cost of Debt of D2L Inc (DTOL.TO) is 4.25%.

Range Selected
Cost of equity 5.20% - 6.70% 5.95%
Tax rate 1.50% - 5.70% 3.60%
Cost of debt 4.00% - 4.50% 4.25%
WACC 5.2% - 6.6% 5.9%
WACC

DTOL.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.4 0.42
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.20% 6.70%
Tax rate 1.50% 5.70%
Debt/Equity ratio 0.02 0.02
Cost of debt 4.00% 4.50%
After-tax WACC 5.2% 6.6%
Selected WACC 5.9%

DTOL.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 DTOL.TO:

cost_of_equity (5.95%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.4) + 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.