SBR.TO WACC - Weighted Average Cost of Capital

The WACC of Silver Bear Resources Inc (SBR.TO) is 7.8%.

The Cost of Equity of Silver Bear Resources Inc (SBR.TO) is 30.15%.

The Cost of Debt of Silver Bear Resources Inc (SBR.TO) is 5.50%.

	Range	Selected
Cost of equity	15.60% - 44.70%	30.15%
Tax rate	-% - 0.10%	0.05%
Cost of debt	4.00% - 7.00%	5.50%
WACC	5.1% - 10.5%	7.8%

WACC

SBR.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	2.44	6.65

Additional risk adjustments	0.0%	0.5%
Cost of equity	15.60%	44.70%

Tax rate	-%	0.10%
Debt/Equity ratio	9.71	9.71
Cost of debt	4.00%	7.00%

After-tax WACC	5.1%	10.5%


Selected WACC	7.8%

SBR.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 SBR.TO:

cost_of_equity (30.15%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (2.44) + 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.