EGLX.TO WACC - Weighted Average Cost of Capital
The WACC of Enthusiast Gaming Holdings Inc (EGLX.TO) is 5.8%.
| Range | Selected | |
| Cost of equity | 5.4% - 12.4% | 8.9% |
| Tax rate | 1.3% - 2.1% | 1.7% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.0% - 6.7% | 5.8% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.43 | 1.34 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.4% | 12.4% |
| Tax rate | 1.3% | 2.1% |
| Debt/Equity ratio | 3.24 | 3.24 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.0% | 6.7% |
| Selected WACC | 5.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| EGLX.TO | Enthusiast Gaming Holdings Inc | 3.24 | 1.93 | 0.46 |
| DEAL.V | Playgon Games Inc | 2.68 | 0.1 | 0.03 |
| FLYY.CN | Media Central Corporation Inc | 0.26 | -0.24 | -0.19 |
| IZEA | IZEA Worldwide Inc | 0 | 1.15 | 1.14 |
| LKCO | Luokung Technology Corp | 70.04 | 0.11 | 0 |
| MDF.TO | mdf Commerce Inc | 0.04 | 0.31 | 0.3 |
| MFON | Mobivity Holdings Corp | 0.36 | 0.06 | 0.04 |
| SLGG | Super League Gaming, Inc. | 0.12 | 2.03 | 1.83 |
| WBWB | WU BA Superior Products Holding Group Inc | 10.72 | 0.18 | 0.02 |
| YNDX | Yandex NV | 0.28 | 1.61 | 1.26 |
| Low | High | |
| Unlevered beta | 0.04 | 0.36 |
| Relevered beta | 0.15 | 1.51 |
| Adjusted relevered beta | 0.43 | 1.34 |
EGLX.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 EGLX.TO:
cost_of_equity (8.90%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.43) + 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.