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 6.75%.

The Cost of Debt of Canada Goose Holdings Inc (GOOS.TO) is 5.35%.

	Range	Selected
Cost of equity	4.90% - 8.60%	6.75%
Tax rate	19.10% - 21.10%	20.10%
Cost of debt	5.30% - 5.40%	5.35%
WACC	4.7% - 7.2%	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	0.33	0.73

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.90%	8.60%

Tax rate	19.10%	21.10%
Debt/Equity ratio	0.46	0.46
Cost of debt	5.30%	5.40%

After-tax WACC	4.7%	7.2%


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 (6.75%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.33) + 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.