The WACC of Score Media and Gaming Inc (SCR.TO) is 8.8%.
| Range | Selected | |
| Cost of equity | 6.70% - 8.90% | 7.80% |
| Tax rate | 24.40% - 26.60% | 25.50% |
| Cost of debt | 4.20% - 26.80% | 15.50% |
| WACC | 5.8% - 11.8% | 8.8% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.7 | 0.78 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.70% | 8.90% |
| Tax rate | 24.40% | 26.60% |
| Debt/Equity ratio | 0.37 | 0.37 |
| Cost of debt | 4.20% | 26.80% |
| After-tax WACC | 5.8% | 11.8% |
| Selected WACC | 8.8% | |
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 SCR.TO:
cost_of_equity (7.80%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.7) + 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.