EGA.V WACC - Weighted Average Cost of Capital
The WACC of Eagle Graphite Inc (EGA.V) is 8.3%.
| Range | Selected | |
| Cost of equity | 7.0% - 9.8% | 8.4% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.0% - 9.7% | 8.3% |
| Category | Low | High |
| Long-term bond rate | 4.2% | 4.7% |
| Equity market risk premium | 5.5% | 6.5% |
| Adjusted beta | 0.52 | 0.71 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.0% | 9.8% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.02 | 0.02 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.0% | 9.7% |
| Selected WACC | 8.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| EGA.V | Eagle Graphite Inc | 0.02 | 2.64 | 2.6 |
| AME.V | Abacus Mining and Exploration Corp | 7.98 | 0 | 0 |
| AZR.V | Azarga Metals Corp | 1.13 | -0.1 | -0.05 |
| CDU.V | Cardero Resource Corp | 0.09 | 1.89 | 1.78 |
| CML.V | CaNickel Mining Ltd | 108.73 | -0.7 | -0.01 |
| DLTA.V | Delta Resources Ltd | 1.16 | 1.42 | 0.77 |
| EGM.V | EnGold Mines Ltd | 0.89 | -1.21 | -0.73 |
| GGL.V | GGL Resources Corp. | 1.11 | 1.66 | 0.92 |
| JOR.V | Ressources Jourdan Inc | 0.01 | 0.19 | 0.18 |
| MWX.V | Mineworx Technologies Ltd | 0.08 | 0.83 | 0.78 |
| TRO.V | Taranis Resources Inc | 0.01 | 0.99 | 0.99 |
| Low | High | |
| Unlevered beta | 0.18 | 0.78 |
| Relevered beta | 0.28 | 0.57 |
| Adjusted relevered beta | 0.52 | 0.71 |
EGA.V'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 EGA.V:
cost_of_equity (8.40%) = risk_free_rate (4.45%) + equity_risk_premium (6.00%) * adjusted_beta (0.52) + 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.