RMRK WACC - Weighted Average Cost of Capital
The WACC of Rimrock Gold Corp (RMRK) is 4.9%.
| Range | Selected | |
| Cost of equity | 4.4% - 8.9% | 6.65% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.0% - 5.8% | 4.9% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.12 | 0.72 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 4.4% | 8.9% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 1.44 | 1.44 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.0% | 5.8% |
| Selected WACC | 4.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| RMRK | Rimrock Gold Corp | 1.44 | -0.95 | -0.46 |
| CBI.V | Colibri Resource Corp | 0.53 | -1.03 | -0.75 |
| FMN.V | Fidelity Minerals Corp | 0.1 | 1.42 | 1.33 |
| GOFF | Goff Corp | 0.84 | 1.39 | 0.86 |
| MCU.V | Mega Copper Ltd | 0.01 | 0.26 | 0.26 |
| MUR.V | Murchison Minerals Ltd | 0.01 | -0.6 | -0.6 |
| ROVR.V | Rover Metals Corp | 0.02 | 1.86 | 1.84 |
| TKU.V | Tarku Resources Ltd | 0.13 | 0.35 | 0.32 |
| VRDR | Verde Resources Inc | 0.01 | -0.39 | -0.38 |
| Low | High | |
| Unlevered beta | -0.25 | 0.31 |
| Relevered beta | -0.31 | 0.58 |
| Adjusted relevered beta | 0.12 | 0.72 |
RMRK'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 RMRK:
cost_of_equity (6.65%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.12) + 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.