SANP WACC - Weighted Average Cost of Capital
The WACC of Santo Mining Corp (SANP) is 6.2%.
| Range | Selected | |
| Cost of equity | 173.2% - 264.2% | 218.7% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.7% - 6.8% | 6.2% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 36.81 | 46.31 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 173.2% | 264.2% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 82.59 | 82.59 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.7% | 6.8% |
| Selected WACC | 6.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SANP | Santo Mining Corp | 82.59 | 0 | 0 |
| CDPR.CN | Cerro De Pasco Resources Inc | 0.01 | 2.02 | 2 |
| ESM.TO | Euro Sun Mining Inc | 0.01 | 0.87 | 0.86 |
| FT.TO | Fortune Minerals Ltd | 0.28 | 1.34 | 1.11 |
| INV.TO | INV Metals Inc | 0.01 | 1.94 | 1.93 |
| LR.V | Luminex Resources Corp | 0 | 0.31 | 0.31 |
| NKL.V | Nickel 28 Capital Corp | 1.21 | 1.71 | 0.91 |
| OM.V | Osisko Metals Inc | 0.19 | 1.28 | 1.13 |
| SX.CN | St-Georges Eco-Mining Corp | 0.08 | 0.7 | 0.66 |
| TSK.TO | Talisker Resources Ltd | 0.09 | 1.43 | 1.34 |
| Low | High | |
| Unlevered beta | 0.89 | 1.12 |
| Relevered beta | 54.45 | 68.63 |
| Adjusted relevered beta | 36.81 | 46.31 |
SANP'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 SANP:
cost_of_equity (218.70%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (36.81) + 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.