SDE.TO
Spartan Delta Corp
Price:  
3.01 
CAD
Volume:  
65,100
Canada | Oil, Gas & Consumable Fuels

SDE.TO WACC - Weighted Average Cost of Capital

The WACC of Spartan Delta Corp (SDE.TO) is 10.0%.

The Cost of Equity of Spartan Delta Corp (SDE.TO) is 10.85%.
The Cost of Debt of Spartan Delta Corp (SDE.TO) is 7.4%.

RangeSelected
Cost of equity9.5% - 12.2%10.85%
Tax rate9.5% - 13.5%11.5%
Cost of debt6.3% - 8.5%7.4%
WACC8.7% - 11.3%10.0%
WACC

SDE.TO WACC calculation

CategoryLowHigh
Long-term bond rate3.2%3.7%
Equity market risk premium5.1%6.1%
Adjusted beta1.241.32
Additional risk adjustments0.0%0.5%
Cost of equity9.5%12.2%
Tax rate9.5%13.5%
Debt/Equity ratio
0.240.24
Cost of debt6.3%8.5%
After-tax WACC8.7%11.3%
Selected WACC10.0%

SDE.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 SDE.TO:

cost_of_equity (10.85%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.24) + 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.