GFL.TO WACC - Weighted Average Cost of Capital

The WACC of GFL Environmental Inc (GFL.TO) is 7.7%.

The Cost of Equity of GFL Environmental Inc (GFL.TO) is 7.20%.

The Cost of Debt of GFL Environmental Inc (GFL.TO) is 12.80%.

	Range	Selected
Cost of equity	6.30% - 8.10%	7.20%
Tax rate	20.60% - 32.80%	26.70%
Cost of debt	5.40% - 20.20%	12.80%
WACC	5.7% - 9.7%	7.7%

WACC

GFL.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.62	0.64

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.30%	8.10%

Tax rate	20.60%	32.80%
Debt/Equity ratio	0.41	0.41
Cost of debt	5.40%	20.20%

After-tax WACC	5.7%	9.7%


Selected WACC	7.7%

GFL.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 GFL.TO:

cost_of_equity (7.20%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.62) + 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.