GH.TO
Gamehost Inc
Price:  
12.45 
CAD
Volume:  
2,012.00
Canada | Hotels, Restaurants & Leisure
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GH.TO WACC - Weighted Average Cost of Capital

The WACC of Gamehost Inc (GH.TO) is 6.4%.

The Cost of Equity of Gamehost Inc (GH.TO) is 7.05%.
The Cost of Debt of Gamehost Inc (GH.TO) is 4.25%.

Range Selected
Cost of equity 6.10% - 8.00% 7.05%
Tax rate 21.90% - 23.00% 22.45%
Cost of debt 4.00% - 4.50% 4.25%
WACC 5.6% - 7.3% 6.4%
WACC

GH.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.57 0.63
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.10% 8.00%
Tax rate 21.90% 23.00%
Debt/Equity ratio 0.18 0.18
Cost of debt 4.00% 4.50%
After-tax WACC 5.6% 7.3%
Selected WACC 6.4%

GH.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 GH.TO:

cost_of_equity (7.05%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.57) + 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.