PRG.V WACC - Weighted Average Cost of Capital
The WACC of Precipitate Gold Corp (PRG.V) is 8.3%.
| Range | Selected | |
| Cost of equity | 10.3% - 15.4% | 12.85% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.0% - 9.5% | 8.3% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 1.27 | 1.73 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.3% | 15.4% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.0% | 9.5% |
| Selected WACC | 8.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| PRG.V | Precipitate Gold Corp | 0.93 | 0.17 | 0.1 |
| ASE.CN | Asante Gold Corp | 0.03 | 0.44 | 0.43 |
| BAT.V | Batero Gold Corp | 0.15 | 0.46 | 0.42 |
| CVB.V | Compass Gold Corp | 0.08 | 0.01 | 0.01 |
| GFG.V | GFG Resources Inc | 0 | 0.59 | 0.59 |
| GGM.V | Granada Gold Mine Inc | 0.28 | 1.31 | 1.09 |
| KTO.V | K2 Gold Corp | 1.03 | 1.39 | 0.79 |
| MAS.V | MAS Gold Corp | 0.03 | 1.72 | 1.68 |
| MM.CN | Metallica Metals Corp | 0 | 1.49 | 1.49 |
| MTU.V | Manitou Gold Inc | 0 | 0.96 | 0.96 |
| RDU.V | Radius Gold Inc | 0.01 | 1.87 | 1.86 |
| Low | High | |
| Unlevered beta | 0.59 | 0.96 |
| Relevered beta | 1.4 | 2.09 |
| Adjusted relevered beta | 1.27 | 1.73 |
PRG.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 PRG.V:
cost_of_equity (12.85%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (1.27) + 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.