FSY.TO WACC - Weighted Average Cost of Capital
The WACC of Forsys Metals Corp (FSY.TO) is 8.5%.
| Range | Selected | |
| Cost of equity | 7.7% - 16.4% | 12.05% |
| Tax rate | 0.6% - 1.4% | 1% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.3% - 10.7% | 8.5% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.89 | 2.01 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.7% | 16.4% |
| Tax rate | 0.6% | 1.4% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.3% | 10.7% |
| Selected WACC | 8.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| FSY.TO | Forsys Metals Corp | 0.85 | 2.24 | 1.21 |
| AMR.V | AM Resources Corp | 0.05 | -0.24 | -0.23 |
| BULL.CN | Canadian Palladium Resources Inc | 0.11 | -0.18 | -0.17 |
| CVV.V | CanAlaska Uranium Ltd | 0 | 1.88 | 1.88 |
| FUU.V | Fission 3.0 Corp | 0.1 | 1.39 | 1.26 |
| LAM.TO | Laramide Resources Ltd | 0.04 | 1.43 | 1.38 |
| PLU.V | Plateau Energy Metals Inc | 0 | 1.6 | 1.6 |
| PTU.V | Purepoint Uranium Group Inc | 0 | -0.1 | -0.1 |
| SRI.V | Sparton Resources Inc | 0.07 | 1.34 | 1.26 |
| UEX.TO | Uex Corp | 0 | 0.65 | 0.65 |
| UWE.H.V | U3O8 Corp | 0.17 | 0.09 | 0.08 |
| Low | High | |
| Unlevered beta | 0.65 | 1.26 |
| Relevered beta | 0.84 | 2.51 |
| Adjusted relevered beta | 0.89 | 2.01 |
FSY.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 FSY.TO:
cost_of_equity (12.05%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.89) + 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.