WCN.TO
Waste Connections Inc
Price:  
241.97 
CAD
Volume:  
69,540.00
Canada | Commercial Services & Supplies
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WCN.TO WACC - Weighted Average Cost of Capital

The WACC of Waste Connections Inc (WCN.TO) is 8.1%.

The Cost of Equity of Waste Connections Inc (WCN.TO) is 8.95%.
The Cost of Debt of Waste Connections Inc (WCN.TO) is 4.25%.

Range Selected
Cost of equity 7.60% - 10.30% 8.95%
Tax rate 19.70% - 20.00% 19.85%
Cost of debt 4.00% - 4.50% 4.25%
WACC 7.0% - 9.3% 8.1%
WACC

WCN.TO WACC calculation

Category Low High
Long-term bond rate 3.2% 3.7%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.87 1
Additional risk adjustments 0.0% 0.5%
Cost of equity 7.60% 10.30%
Tax rate 19.70% 20.00%
Debt/Equity ratio 0.17 0.17
Cost of debt 4.00% 4.50%
After-tax WACC 7.0% 9.3%
Selected WACC 8.1%

WCN.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 WCN.TO:

cost_of_equity (8.95%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.87) + 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.