TWM.TO
Tidewater Midstream and Infrastructure Ltd
Price:  
0.28 
CAD
Volume:  
133,111.00
Canada | Oil, Gas & Consumable Fuels
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TWM.TO WACC - Weighted Average Cost of Capital

The WACC of Tidewater Midstream and Infrastructure Ltd (TWM.TO) is 10.1%.

The Cost of Equity of Tidewater Midstream and Infrastructure Ltd (TWM.TO) is 7.80%.
The Cost of Debt of Tidewater Midstream and Infrastructure Ltd (TWM.TO) is 13.45%.

Range Selected
Cost of equity 6.40% - 9.20% 7.80%
Tax rate 17.50% - 21.90% 19.70%
Cost of debt 6.70% - 20.20% 13.45%
WACC 5.7% - 14.6% 10.1%
WACC

TWM.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.63 0.82
Additional risk adjustments 0.0% 0.5%
Cost of equity 6.40% 9.20%
Tax rate 17.50% 21.90%
Debt/Equity ratio 4.83 4.83
Cost of debt 6.70% 20.20%
After-tax WACC 5.7% 14.6%
Selected WACC 10.1%

TWM.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 TWM.TO:

cost_of_equity (7.80%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.63) + 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.