SGNL.TO WACC - Weighted Average Cost of Capital

The WACC of Signal Gold Inc (SGNL.TO) is 9.2%.

The Cost of Equity of Signal Gold Inc (SGNL.TO) is 12.15%.

The Cost of Debt of Signal Gold Inc (SGNL.TO) is 8.70%.

	Range	Selected
Cost of equity	10.70% - 13.60%	12.15%
Tax rate	30.00% - 47.10%	38.55%
Cost of debt	7.00% - 10.40%	8.70%
WACC	8.3% - 10.2%	9.2%

WACC

SGNL.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	1.48	1.55

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.70%	13.60%

Tax rate	30.00%	47.10%
Debt/Equity ratio	0.72	0.72
Cost of debt	7.00%	10.40%

After-tax WACC	8.3%	10.2%


Selected WACC	9.2%

SGNL.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 SGNL.TO:

cost_of_equity (12.15%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.48) + 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.