VTX.V WACC - Weighted Average Cost of Capital

The WACC of Vertex Resource Group Ltd (VTX.V) is 11.8%.

The Cost of Equity of Vertex Resource Group Ltd (VTX.V) is 12.75%.

The Cost of Debt of Vertex Resource Group Ltd (VTX.V) is 15.05%.

	Range	Selected
Cost of equity	7.90% - 17.60%	12.75%
Tax rate	16.60% - 23.60%	20.10%
Cost of debt	6.20% - 23.90%	15.05%
WACC	5.5% - 18.1%	11.8%

WACC

VTX.V WACC calculation

Category	Low	High

Long-term bond rate	3.9%	4.4%
Equity market risk premium	5.1%	6.1%
Adjusted beta	0.78	2.09

Additional risk adjustments	0.0%	0.5%
Cost of equity	7.90%	17.60%

Tax rate	16.60%	23.60%
Debt/Equity ratio	5.96	5.96
Cost of debt	6.20%	23.90%

After-tax WACC	5.5%	18.1%


Selected WACC	11.8%

VTX.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 VTX.V:

cost_of_equity (12.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.60%) * adjusted_beta (0.78) + 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.