GURU.TO WACC - Weighted Average Cost of Capital

The WACC of Guru Organic Energy Corp (GURU.TO) is 8.3%.

The Cost of Equity of Guru Organic Energy Corp (GURU.TO) is 8.25%.

The Cost of Debt of Guru Organic Energy Corp (GURU.TO) is 7.75%.

	Range	Selected
Cost of equity	6.50% - 10.00%	8.25%
Tax rate	0.50% - 1.20%	0.85%
Cost of debt	7.00% - 8.50%	7.75%
WACC	6.5% - 10.0%	8.3%

WACC

GURU.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.66	0.96

Additional risk adjustments	0.0%	0.5%
Cost of equity	6.50%	10.00%

Tax rate	0.50%	1.20%
Debt/Equity ratio	0.01	0.01
Cost of debt	7.00%	8.50%

After-tax WACC	6.5%	10.0%


Selected WACC	8.3%

GURU.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 GURU.TO:

cost_of_equity (8.25%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.66) + 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.