GDL.TO WACC - Weighted Average Cost of Capital

The WACC of Goodfellow Inc (GDL.TO) is 8.9%.

The Cost of Equity of Goodfellow Inc (GDL.TO) is 10.10%.

The Cost of Debt of Goodfellow Inc (GDL.TO) is 6.15%.

	Range	Selected
Cost of equity	8.50% - 11.70%	10.10%
Tax rate	26.50% - 26.90%	26.70%
Cost of debt	4.10% - 8.20%	6.15%
WACC	7.3% - 10.5%	8.9%

WACC

GDL.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	1.05	1.23

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.50%	11.70%

Tax rate	26.50%	26.90%
Debt/Equity ratio	0.27	0.27
Cost of debt	4.10%	8.20%

After-tax WACC	7.3%	10.5%


Selected WACC	8.9%

GDL.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 GDL.TO:

cost_of_equity (10.10%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.05) + 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.