KUB.V WACC - Weighted Average Cost of Capital
The WACC of Cub Energy Inc (KUB.V) is 9.3%.
| Range | Selected | |
| Cost of equity | 9.1% - 12.8% | 10.95% |
| Tax rate | 0.0% - 0.1% | 0.05% |
| Cost of debt | 4.0% - 4.6% | 4.3% |
| WACC | 7.8% - 10.7% | 9.3% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 1.03 | 1.3 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.1% | 12.8% |
| Tax rate | 0.0% | 0.1% |
| Debt/Equity ratio | 0.33 | 0.33 |
| Cost of debt | 4.0% | 4.6% |
| After-tax WACC | 7.8% | 10.7% |
| Selected WACC | 9.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| KUB.V | Cub Energy Inc | 0.33 | 1.53 | 1.15 |
| ATU.V | Altura Energy Inc | 0.14 | 2.04 | 1.78 |
| HOCL.V | Highwood Oil Company Ltd | 0.07 | 0.93 | 0.87 |
| KEI.TO | Kolibri Global Energy Inc | 0.15 | 0.75 | 0.66 |
| NZ.V | New Zealand Energy Corp | 0.47 | 2.05 | 1.39 |
| PEI.V | Prospera Energy Inc | 0.5 | 0.19 | 0.13 |
| RSRV | Reserve Petroleum Co | 0.05 | 0.06 | 0.06 |
| SOIL.V | Saturn Oil & Gas Inc | 0.67 | 1.75 | 1.05 |
| TAO.V | TAG Oil Ltd | 0.02 | 2.05 | 2.02 |
| XBOR | Cross Border Resources Inc | 0.47 | 0 | 0 |
| Low | High | |
| Unlevered beta | 0.78 | 1.09 |
| Relevered beta | 1.04 | 1.45 |
| Adjusted relevered beta | 1.03 | 1.3 |
KUB.V'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 KUB.V:
cost_of_equity (10.95%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (1.03) + 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.