MOGO.TO
Mogo Inc
Price:  
1.52 
CAD
Volume:  
32,817.00
Canada | Consumer Finance
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MOGO.TO WACC - Weighted Average Cost of Capital

The WACC of Mogo Inc (MOGO.TO) is 8.0%.

The Cost of Equity of Mogo Inc (MOGO.TO) is 7.15%.
The Cost of Debt of Mogo Inc (MOGO.TO) is 8.50%.

Range Selected
Cost of equity 5.70% - 8.60% 7.15%
Tax rate 0.50% - 1.30% 0.90%
Cost of debt 7.00% - 10.00% 8.50%
WACC 6.6% - 9.4% 8.0%
WACC

MOGO.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.5 0.73
Additional risk adjustments 0.0% 0.5%
Cost of equity 5.70% 8.60%
Tax rate 0.50% 1.30%
Debt/Equity ratio 2.13 2.13
Cost of debt 7.00% 10.00%
After-tax WACC 6.6% 9.4%
Selected WACC 8.0%

MOGO.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 MOGO.TO:

cost_of_equity (7.15%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.5) + 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.