U.TO WACC - Weighted Average Cost of Capital

The WACC of Uranium Participation Corp (U.TO) is 7.2%.

The Cost of Equity of Uranium Participation Corp (U.TO) is 10.65%.

The Cost of Debt of Uranium Participation Corp (U.TO) is 5.00%.

	Range	Selected
Cost of equity	8.50% - 12.80%	10.65%
Tax rate	26.50% - 26.50%	26.50%
Cost of debt	5.00% - 5.00%	5.00%
WACC	6.1% - 8.2%	7.2%

WACC

U.TO WACC calculation

Category	Low	High

Long-term bond rate	3.4%	3.9%
Equity market risk premium	4.7%	5.7%
Adjusted beta	1.09	1.47

Additional risk adjustments	0.0%	0.5%
Cost of equity	8.50%	12.80%

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

After-tax WACC	6.1%	8.2%


Selected WACC	7.2%

U.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 U.TO:

cost_of_equity (10.65%) = risk_free_rate (3.65%) + equity_risk_premium (5.20%) * adjusted_beta (1.09) + 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.