The WACC of Nevada Zinc Corp (NZN.V) is 6.7%.
Range | Selected | |
Cost of equity | 6.9% - 12.6% | 9.75% |
Tax rate | 26.2% - 27.0% | 26.6% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 5.3% - 8.1% | 6.7% |
Category | Low | High |
Long-term bond rate | 3.9% | 4.4% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 0.59 | 1.27 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 6.9% | 12.6% |
Tax rate | 26.2% | 27.0% |
Debt/Equity ratio | 1 | 1 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 5.3% | 8.1% |
Selected WACC | 6.7% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
NZN.V | Nevada Zinc Corp | 0.95 | 4.58 | 2.7 |
AAN.V | Aton Resources Inc | 0.39 | -0.27 | -0.21 |
AFF.V | Affinity Metals Corp | 0.1 | 0.27 | 0.25 |
BAY.V | Aston Bay Holdings Ltd | 0.04 | 1.28 | 1.24 |
CDU.V | Cardero Resource Corp | 0.09 | 1.89 | 1.78 |
CMD.V | Commander Resources Ltd | 0.01 | 0.65 | 0.64 |
JOR.V | Ressources Jourdan Inc | 0.01 | 0.19 | 0.18 |
MAC.V | THEMAC Resources Group Ltd | 31.43 | 1.9 | 0.08 |
RMD.V | Richmond Minerals Inc | 0.17 | -0.08 | -0.08 |
SZM.V | ScoZinc Mining Ltd | 0 | 1.87 | 1.86 |
XMG.CN | MGX Minerals Inc | 0.52 | 1.46 | 1.05 |
Low | High | |
Unlevered beta | 0.25 | 1.05 |
Relevered beta | 0.39 | 1.4 |
Adjusted relevered beta | 0.59 | 1.27 |
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 NZN.V:
cost_of_equity (9.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.59) + 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.