RBY.TO
Rubellite Energy Inc
Price:  
1.78 
CAD
Volume:  
1,575
Canada | Oil, Gas & Consumable Fuels

RBY.TO WACC - Weighted Average Cost of Capital

The WACC of Rubellite Energy Inc (RBY.TO) is 8.4%.

The Cost of Equity of Rubellite Energy Inc (RBY.TO) is 12.05%.
The Cost of Debt of Rubellite Energy Inc (RBY.TO) is 5%.

RangeSelected
Cost of equity10.2% - 13.9%12.05%
Tax rate18.3% - 27.3%22.8%
Cost of debt5.0% - 5.0%5%
WACC7.5% - 9.3%8.4%
WACC

RBY.TO WACC calculation

CategoryLowHigh
Long-term bond rate3.2%3.7%
Equity market risk premium5.1%6.1%
Adjusted beta1.381.59
Additional risk adjustments0.0%0.5%
Cost of equity10.2%13.9%
Tax rate18.3%27.3%
Debt/Equity ratio
0.80.8
Cost of debt5.0%5.0%
After-tax WACC7.5%9.3%
Selected WACC8.4%

RBY.TO WACC - Detailed calculations of Beta

Debt/EquityUnlevered
PeersCompany NameratioBetabeta
RBY.TORubellite Energy Inc0.81.330.82
LowHigh
Unlevered beta0.820.82
Relevered beta1.571.88
Adjusted relevered beta1.381.59

RBY.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 RBY.TO:

cost_of_equity (12.05%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.38) + 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.