STWO.CN WACC - Weighted Average Cost of Capital

The WACC of S2 Minerals Inc (STWO.CN) is 11.5%.

The Cost of Equity of S2 Minerals Inc (STWO.CN) is 19.30%.

The Cost of Debt of S2 Minerals Inc (STWO.CN) is 5.00%.

	Range	Selected
Cost of equity	17.40% - 21.20%	19.30%
Tax rate	25.90% - 26.50%	26.20%
Cost of debt	5.00% - 5.00%	5.00%
WACC	10.6% - 12.5%	11.5%

WACC

STWO.CN WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	5.1%	6.1%
Adjusted beta	2.8	2.8

Additional risk adjustments	0.0%	0.5%
Cost of equity	17.40%	21.20%

Tax rate	25.90%	26.50%
Debt/Equity ratio	1	1
Cost of debt	5.00%	5.00%

After-tax WACC	10.6%	12.5%


Selected WACC	11.5%

STWO.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 STWO.CN:

cost_of_equity (19.30%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (2.8) + 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.