KEC.TO WACC - Weighted Average Cost of Capital

The WACC of Kiwetinohk Energy Corp (KEC.TO) is 12.1%.

The Cost of Equity of Kiwetinohk Energy Corp (KEC.TO) is 3.65%.

The Cost of Debt of Kiwetinohk Energy Corp (KEC.TO) is 60.55%.

	Range	Selected
Cost of equity	3.00% - 4.30%	3.65%
Tax rate	19.60% - 26.20%	22.90%
Cost of debt	4.00% - 117.10%	60.55%
WACC	3.1% - 21.1%	12.1%

WACC

KEC.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	-0.22	-0.14

Additional risk adjustments	1.0%	1.5%
Cost of equity	3.00%	4.30%

Tax rate	19.60%	26.20%
Debt/Equity ratio	0.26	0.26
Cost of debt	4.00%	117.10%

After-tax WACC	3.1%	21.1%


Selected WACC	12.1%

KEC.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 KEC.TO:

cost_of_equity (3.65%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (-0.22) + risk_adjustments (1.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.