TLO.TO WACC - Weighted Average Cost of Capital
The WACC of Talon Metals Corp (TLO.TO) is 6.8%.
| Range | Selected | |
| Cost of equity | 5.6% - 8.0% | 6.8% |
| Tax rate | 25.9% - 26.5% | 26.2% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.6% - 8.0% | 6.8% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.48 | 0.63 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.6% | 8.0% |
| Tax rate | 25.9% | 26.5% |
| Debt/Equity ratio | 0 | 0 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.6% | 8.0% |
| Selected WACC | 6.8% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TLO.TO | Talon Metals Corp | 0 | 1.89 | 1.89 |
| HPQ.V | HPQ Silicon Resources Inc | 0 | -0.19 | -0.19 |
| MIN.TO | Excelsior Mining Corp | 0.58 | 0.35 | 0.25 |
| NB.TO | NioCorp Developments Ltd | 0.05 | -1.78 | -1.72 |
| NCU.TO | Nevada Copper Corp | 7.7 | 1.28 | 0.19 |
| NEXT.TO | NextSource Materials Inc | 0.73 | 0.39 | 0.25 |
| POM.TO | Polymet Mining Corp | 0.24 | -0.31 | -0.27 |
| SLL.V | Standard Lithium Ltd | 0.01 | 1.88 | 1.87 |
| TUD.V | Tudor Gold Corp | 0 | 0.76 | 0.76 |
| WM.TO | Wallbridge Mining Company Ltd | 0 | 1.76 | 1.76 |
| Low | High | |
| Unlevered beta | 0.22 | 0.45 |
| Relevered beta | 0.22 | 0.45 |
| Adjusted relevered beta | 0.48 | 0.63 |
TLO.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 TLO.TO:
cost_of_equity (6.80%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.48) + 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.