PRL.TO WACC - Weighted Average Cost of Capital

The WACC of Propel Holdings Inc (PRL.TO) is 7.3%.

The Cost of Equity of Propel Holdings Inc (PRL.TO) is 7.45%.

The Cost of Debt of Propel Holdings Inc (PRL.TO) is 9.25%.

	Range	Selected
Cost of equity	5.90% - 9.00%	7.45%
Tax rate	25.60% - 26.30%	25.95%
Cost of debt	4.90% - 13.60%	9.25%
WACC	5.4% - 9.2%	7.3%

WACC

PRL.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.53	0.79

Additional risk adjustments	0.0%	0.5%
Cost of equity	5.90%	9.00%

Tax rate	25.60%	26.30%
Debt/Equity ratio	0.27	0.27
Cost of debt	4.90%	13.60%

After-tax WACC	5.4%	9.2%


Selected WACC	7.3%

PRL.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 PRL.TO:

cost_of_equity (7.45%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.53) + 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.