TSN.V WACC - Weighted Average Cost of Capital
The WACC of Telson Mining Corp (TSN.V) is 7.7%.
| Range | Selected | |
| Cost of equity | 7.7% - 10.0% | 8.85% |
| Tax rate | 27.0% - 27.0% | 27% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 6.6% - 8.9% | 7.7% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 4.7% | 5.7% |
| Adjusted beta | 0.95 | 1.01 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.7% | 10.0% |
| Tax rate | 27.0% | 27.0% |
| Debt/Equity ratio | 0.28 | 0.28 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 6.6% | 8.9% |
| Selected WACC | 7.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TSN.V | Telson Mining Corp | 0.28 | 2.07 | 1.72 |
| EAM.V | East Africa Metals Inc | 0.02 | -0.68 | -0.67 |
| EPL.V | Eagle Plains Resources Ltd | 1.06 | -0.06 | -0.03 |
| GPH.V | Graphite One Inc | 0 | 0.84 | 0.84 |
| GZZ.V | Golden Valley Mines Ltd | 0 | 1.01 | 1.01 |
| HI.V | Highland Copper Company Inc | 0.04 | 0.36 | 0.35 |
| KDK.V | Kodiak Copper Corp | 0.93 | 2.2 | 1.31 |
| MD.V | Midland Exploration Inc | 0 | 0.26 | 0.26 |
| NJMC | New Jersey Mining Co | 0.04 | 0.32 | 0.31 |
| SNS.V | Select Sands Corp | 38.59 | 1.64 | 0.06 |
| Low | High | |
| Unlevered beta | 0.29 | 0.55 |
| Relevered beta | 0.93 | 1.01 |
| Adjusted relevered beta | 0.95 | 1.01 |
TSN.V'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 TSN.V:
cost_of_equity (8.85%) = risk_free_rate (3.45%) + equity_risk_premium (5.20%) * adjusted_beta (0.95) + 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.