GCL.TO
Colabor Group Inc
Price:  
0.84 
CAD
Volume:  
25,667.00
Canada | Food & Staples Retailing
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GCL.TO WACC - Weighted Average Cost of Capital

The WACC of Colabor Group Inc (GCL.TO) is 9.2%.

The Cost of Equity of Colabor Group Inc (GCL.TO) is 7.45%.
The Cost of Debt of Colabor Group Inc (GCL.TO) is 14.90%.

Range Selected
Cost of equity 6.20% - 8.70% 7.45%
Tax rate 26.10% - 28.00% 27.05%
Cost of debt 14.90% - 14.90% 14.90%
WACC 8.7% - 9.8% 9.2%
WACC

GCL.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.6 0.75
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.20% 8.70%
Tax rate 26.10% 28.00%
Debt/Equity ratio 1.08 1.08
Cost of debt 14.90% 14.90%
After-tax WACC 8.7% 9.8%
Selected WACC 9.2%

GCL.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 GCL.TO:

cost_of_equity (7.45%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.6) + 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.