SBB.TO WACC - Weighted Average Cost of Capital
The WACC of Sabina Gold & Silver Corp (SBB.TO) is 9.2%.
| Range | Selected | |
| Cost of equity | 8.1% - 11.2% | 9.65% |
| Tax rate | 25.9% - 26.5% | 26.2% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 7.7% - 10.6% | 9.2% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.96 | 1.16 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.1% | 11.2% |
| Tax rate | 25.9% | 26.5% |
| Debt/Equity ratio | 0.08 | 0.08 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 7.7% | 10.6% |
| Selected WACC | 9.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| SBB.TO | Sabina Gold & Silver Corp | 0.08 | 0.87 | 0.82 |
| FVL.TO | Freegold Ventures Ltd | 0 | 1.41 | 1.41 |
| GAU.TO | Galiano Gold Inc | 0.12 | 1.1 | 1.02 |
| HYMC | Hycroft Mining Holding Corporation | 1.07 | 0.84 | 0.47 |
| KOR.TO | Corvus Gold Inc | 0.01 | 1.45 | 1.44 |
| LGD.TO | Liberty Gold Corp | 0 | 1.39 | 1.38 |
| MOZ.TO | Marathon Gold Corp | 0.09 | 1.57 | 1.47 |
| NSR.TO | Nomad Royalty Company Ltd | 0.18 | 1.06 | 0.94 |
| RUP.V | Rupert Resources Ltd | 0 | 0.8 | 0.8 |
| VGCX.TO | Victoria Gold Corp | 7.37 | 0.17 | 0.03 |
| Low | High | |
| Unlevered beta | 0.89 | 1.16 |
| Relevered beta | 0.94 | 1.24 |
| Adjusted relevered beta | 0.96 | 1.16 |
SBB.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 SBB.TO:
cost_of_equity (9.65%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.96) + 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.