SOL.CN WACC - Weighted Average Cost of Capital

The WACC of SOL Global Investments Corp (SOL.CN) is 7.7%.

The Cost of Equity of SOL Global Investments Corp (SOL.CN) is 12.85%.

The Cost of Debt of SOL Global Investments Corp (SOL.CN) is 6.75%.

	Range	Selected
Cost of equity	8.20% - 17.50%	12.85%
Tax rate	3.30% - 9.70%	6.50%
Cost of debt	6.50% - 7.00%	6.75%
WACC	6.7% - 8.7%	7.7%

WACC

SOL.CN WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.99	2.18

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.20%	17.50%

Tax rate	3.30%	9.70%
Debt/Equity ratio	3.65	3.65
Cost of debt	6.50%	7.00%

After-tax WACC	6.7%	8.7%


Selected WACC	7.7%

SOL.CN'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 SOL.CN:

cost_of_equity (12.85%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.99) + 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.