SGNL.TO
Signal Gold Inc
Price:  
0.09 
CAD
Volume:  
1,327,150.00
Canada | Metals & Mining
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SGNL.TO WACC - Weighted Average Cost of Capital

The WACC of Signal Gold Inc (SGNL.TO) is 8.4%.

The Cost of Equity of Signal Gold Inc (SGNL.TO) is 10.75%.
The Cost of Debt of Signal Gold Inc (SGNL.TO) is 8.70%.

Range Selected
Cost of equity 9.50% - 12.00% 10.75%
Tax rate 30.00% - 47.10% 38.55%
Cost of debt 7.00% - 10.40% 8.70%
WACC 7.6% - 9.3% 8.4%
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 1.24 1.28
Additional risk adjustments 0.0% 0.5%
Cost of equity 9.50% 12.00%
Tax rate 30.00% 47.10%
Debt/Equity ratio 0.72 0.72
Cost of debt 7.00% 10.40%
After-tax WACC 7.6% 9.3%
Selected WACC 8.4%

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 (10.75%) = 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.