The WACC of Excellon Resources Inc (EXN.TO) is 10.4%.
Range | Selected | |
Cost of equity | 9.8% - 13.8% | 11.8% |
Tax rate | 10.6% - 11.9% | 11.25% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 8.8% - 12.0% | 10.4% |
Category | Low | High |
Long-term bond rate | 3.2% | 3.7% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 1.3 | 1.59 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 9.8% | 13.8% |
Tax rate | 10.6% | 11.9% |
Debt/Equity ratio | 0.24 | 0.24 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 8.8% | 12.0% |
Selected WACC | 10.4% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
EXN.TO | Excellon Resources Inc | 0.24 | 0.98 | 0.81 |
ANX.TO | Anaconda Mining Inc | 0.02 | 2.07 | 2.04 |
AUN.V | Aurcana Silver Corp | 7.51 | 1.44 | 0.19 |
FVI.TO | Fortuna Silver Mines Inc | 0.09 | 1.57 | 1.45 |
IPT.V | Impact Silver Corp | 0 | 1.5 | 1.5 |
KTN.V | Kootenay Silver Inc | 0 | 1.69 | 1.69 |
MSV.TO | Minco Silver Corp | 0.03 | -0.36 | -0.35 |
PAAS.TO | Pan American Silver Corp | 0.07 | 1.75 | 1.64 |
SBR.TO | Silver Bear Resources Inc | 9.71 | 0 | 0 |
SVM.TO | Silvercorp Metals Inc | 0.1 | 1.76 | 1.61 |
Low | High | |
Unlevered beta | 1.19 | 1.54 |
Relevered beta | 1.45 | 1.88 |
Adjusted relevered beta | 1.3 | 1.59 |
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 EXN.TO:
cost_of_equity (11.80%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.3) + 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.