STC.TO
Sangoma Technologies Corp
Price:  
7.93 
CAD
Volume:  
10,131.00
Canada | Communications Equipment
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STC.TO WACC - Weighted Average Cost of Capital

The WACC of Sangoma Technologies Corp (STC.TO) is 8.1%.

The Cost of Equity of Sangoma Technologies Corp (STC.TO) is 9.35%.
The Cost of Debt of Sangoma Technologies Corp (STC.TO) is 5.00%.

Range Selected
Cost of equity 7.90% - 10.80% 9.35%
Tax rate 9.00% - 14.90% 11.95%
Cost of debt 5.00% - 5.00% 5.00%
WACC 7.1% - 9.2% 8.1%
WACC

STC.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.94 1.1
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.90% 10.80%
Tax rate 9.00% 14.90%
Debt/Equity ratio 0.34 0.34
Cost of debt 5.00% 5.00%
After-tax WACC 7.1% 9.2%
Selected WACC 8.1%

STC.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 STC.TO:

cost_of_equity (9.35%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.94) + 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.