GOOS.TO WACC - Weighted Average Cost of Capital

The WACC of Canada Goose Holdings Inc (GOOS.TO) is 6.0%.

The Cost of Equity of Canada Goose Holdings Inc (GOOS.TO) is 6.95%.

The Cost of Debt of Canada Goose Holdings Inc (GOOS.TO) is 4.95%.

	Range	Selected
Cost of equity	5.40% - 8.50%	6.95%
Tax rate	19.40% - 21.10%	20.25%
Cost of debt	4.60% - 5.30%	4.95%
WACC	4.9% - 7.1%	6.0%

WACC

GOOS.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.45	0.72

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.40%	8.50%

Tax rate	19.40%	21.10%
Debt/Equity ratio	0.5	0.5
Cost of debt	4.60%	5.30%

After-tax WACC	4.9%	7.1%


Selected WACC	6.0%

GOOS.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 GOOS.TO:

cost_of_equity (6.95%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.45) + 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.