The WACC of Stakeholder Gold Corp (SRC.V) is 8.7%.
Range | Selected | |
Cost of equity | 11.5% - 15.9% | 13.7% |
Tax rate | 26.2% - 27.0% | 26.6% |
Cost of debt | 5.0% - 5.0% | 5% |
WACC | 7.6% - 9.8% | 8.7% |
Category | Low | High |
Long-term bond rate | 3.9% | 4.4% |
Equity market risk premium | 5.1% | 6.1% |
Adjusted beta | 1.49 | 1.8 |
Additional risk adjustments | 0.0% | 0.5% |
Cost of equity | 11.5% | 15.9% |
Tax rate | 26.2% | 27.0% |
Debt/Equity ratio | 1 | 1 |
Cost of debt | 5.0% | 5.0% |
After-tax WACC | 7.6% | 9.8% |
Selected WACC | 8.7% | |
Debt/Equity | Unlevered | |||
Peers | Company Name | ratio | Beta | beta |
SRC.V | Stakeholder Gold Corp | 1.01 | 0.64 | 0.37 |
GOM.V | Golden Dawn Minerals Inc | 0.32 | 1.64 | 1.33 |
IMA.V | I Minerals Inc | 56.34 | 1.09 | 0.03 |
KMAX.V | OrganiMax Nutrient Corp | 0.01 | 1.05 | 1.04 |
LBY.V | Liberty One Lithium Corp | 0.03 | 2.05 | 2.01 |
MFM.V | Marifil Mines Ltd | 0.06 | 1.4 | 1.35 |
PSE.CN | Pasinex Resources Ltd | 0.29 | -1.54 | -1.27 |
QZM.V | Quartz Mountain Resources Ltd | 0 | 0.98 | 0.98 |
VZZ.V | Val d Or Mining Corp | 0.08 | 1.05 | 0.99 |
Z.V | Zinc One Resources Inc | 0.13 | 1.97 | 1.8 |
Low | High | |
Unlevered beta | 0.99 | 1.16 |
Relevered beta | 1.73 | 2.19 |
Adjusted relevered beta | 1.49 | 1.8 |
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 SRC.V:
cost_of_equity (13.70%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (1.49) + 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.