FVI.TO
Fortuna Silver Mines Inc
Price:  
8.74 
CAD
Volume:  
348,665.00
Canada | Metals & Mining
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FVI.TO WACC - Weighted Average Cost of Capital

The WACC of Fortuna Silver Mines Inc (FVI.TO) is 9.8%.

The Cost of Equity of Fortuna Silver Mines Inc (FVI.TO) is 10.45%.
The Cost of Debt of Fortuna Silver Mines Inc (FVI.TO) is 4.45%.

Range Selected
Cost of equity 8.60% - 12.30% 10.45%
Tax rate 25.90% - 26.50% 26.20%
Cost of debt 4.00% - 4.90% 4.45%
WACC 8.1% - 11.6% 9.8%
WACC

FVI.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 1.07 1.34
Additional risk adjustments 0.0% 0.5%
Cost of equity 8.60% 12.30%
Tax rate 25.90% 26.50%
Debt/Equity ratio 0.1 0.1
Cost of debt 4.00% 4.90%
After-tax WACC 8.1% 11.6%
Selected WACC 9.8%

FVI.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 FVI.TO:

cost_of_equity (10.45%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.07) + 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.