SOY.TO WACC - Weighted Average Cost of Capital

The WACC of Sunopta Inc (SOY.TO) is 5.5%.

The Cost of Equity of Sunopta Inc (SOY.TO) is 5.75%.

The Cost of Debt of Sunopta Inc (SOY.TO) is 5.90%.

	Range	Selected
Cost of equity	4.80% - 6.70%	5.75%
Tax rate	16.40% - 18.30%	17.35%
Cost of debt	4.00% - 7.80%	5.90%
WACC	4.3% - 6.6%	5.5%

WACC

SOY.TO WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.31	0.42

Additional risk adjustments	0.0%	0.5%
Cost of equity	4.80%	6.70%

Tax rate	16.40%	18.30%
Debt/Equity ratio	0.4	0.4
Cost of debt	4.00%	7.80%

After-tax WACC	4.3%	6.6%


Selected WACC	5.5%

SOY.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 SOY.TO:

cost_of_equity (5.75%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.31) + 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.