SGLD.TO WACC - Weighted Average Cost of Capital

The WACC of Sabre Gold Mines Corp (SGLD.TO) is 9.1%.

The Cost of Equity of Sabre Gold Mines Corp (SGLD.TO) is 10.50%.

The Cost of Debt of Sabre Gold Mines Corp (SGLD.TO) is 5.00%.

	Range	Selected
Cost of equity	9.30% - 11.70%	10.50%
Tax rate	0.10% - 0.40%	0.25%
Cost of debt	5.00% - 5.00%	5.00%
WACC	8.2% - 10.0%	9.1%

WACC

SGLD.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	1.2	1.23

Additional risk adjustments	0.0%	0.5%
Cost of equity	9.30%	11.70%

Tax rate	0.10%	0.40%
Debt/Equity ratio	0.34	0.34
Cost of debt	5.00%	5.00%

After-tax WACC	8.2%	10.0%


Selected WACC	9.1%

SGLD.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 SGLD.TO:

cost_of_equity (10.50%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.2) + 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.