The WACC of Etruscus Resources Corp (ETR.CN) is 6.1%.
Range | Selected | |
Cost of equity | 4.7% - 7.6% | 6.15% |
Tax rate | 25.9% - 26.5% | 26.2% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 4.7% - 7.5% | 6.1% |
Category | Low | High |
Long-term bond rate | 3.2% | 3.7% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 0.31 | 0.56 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 4.7% | 7.6% |
Tax rate | 25.9% | 26.5% |
Debt/Equity ratio | 0.01 | 0.01 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 4.7% | 7.5% |
Selected WACC | 6.1% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
ETR.CN | Etruscus Resources Corp | 0.01 | 0.99 | 0.98 |
CBI.V | Colibri Resource Corp | 0.53 | -0.78 | -0.56 |
CRES.CN | Crest Resources Inc | 0.01 | -1.71 | -1.7 |
CRUZ.CN | Cruz Cobalt Corp | 0.05 | 0.47 | 0.45 |
GGAU.V | Gambier Gold Corp | 0 | 0.17 | 0.17 |
MCU.V | Mega Copper Ltd | 0.01 | 0.26 | 0.26 |
RAYN.CN | Raindrop Ventures Inc | 0 | 1.01 | 1.01 |
RMES | Red Metal Resources Ltd | 0.17 | 1.07 | 0.95 |
RMRK | Rimrock Gold Corp | 1.25 | -0.65 | -0.34 |
VRDR | Verde Resources Inc | 0.01 | -0.38 | -0.38 |
Low | High | |
Unlevered beta | -0.03 | 0.34 |
Relevered beta | -0.03 | 0.34 |
Adjusted relevered beta | 0.31 | 0.56 |
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 ETR.CN:
cost_of_equity (6.15%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.31) + 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.