ICE.TO WACC - Weighted Average Cost of Capital

The WACC of Canlan Ice Sports Corp (ICE.TO) is 7.6%.

The Cost of Equity of Canlan Ice Sports Corp (ICE.TO) is 10.60%.

The Cost of Debt of Canlan Ice Sports Corp (ICE.TO) is 5.90%.

	Range	Selected
Cost of equity	8.70% - 12.50%	10.60%
Tax rate	17.90% - 37.50%	27.70%
Cost of debt	5.50% - 6.30%	5.90%
WACC	6.7% - 8.5%	7.6%

WACC

ICE.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	1.08	1.37

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.70%	12.50%

Tax rate	17.90%	37.50%
Debt/Equity ratio	0.9	0.9
Cost of debt	5.50%	6.30%

After-tax WACC	6.7%	8.5%


Selected WACC	7.6%

ICE.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 ICE.TO:

cost_of_equity (10.60%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.08) + 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.