LR.V
Luminex Resources Corp
Price:  
0.18 
CAD
Volume:  
281,500
Canada | Metals & Mining

LR.V WACC - Weighted Average Cost of Capital

The WACC of Luminex Resources Corp (LR.V) is 10.0%.

The Cost of Equity of Luminex Resources Corp (LR.V) is 10.05%.
The Cost of Debt of Luminex Resources Corp (LR.V) is 5%.

RangeSelected
Cost of equity8.6% - 11.5%10.05%
Tax rate26.2% - 27.0%26.6%
Cost of debt5.0% - 5.0%5%
WACC8.6% - 11.4%10.0%
WACC

LR.V WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium5.1%6.1%
Adjusted beta0.931.08
Additional risk adjustments0.0%0.5%
Cost of equity8.6%11.5%
Tax rate26.2%27.0%
Debt/Equity ratio
00
Cost of debt5.0%5.0%
After-tax WACC8.6%11.4%
Selected WACC10.0%

LR.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 LR.V:

cost_of_equity (10.05%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.93) + 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.