XTG.TO WACC - Weighted Average Cost of Capital
The WACC of Xtra Gold Resources Corp (XTG.TO) is 5.9%.
| Range | Selected | |
| Cost of equity | 6.8% - 9.3% | 8.05% |
| Tax rate | 25.9% - 26.5% | 26.2% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.2% - 6.5% | 5.9% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.71 | 0.84 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.8% | 9.3% |
| Tax rate | 25.9% | 26.5% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.2% | 6.5% |
| Selected WACC | 5.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| XTG.TO | Xtra Gold Resources Corp | 0.81 | -0.47 | -0.29 |
| AEX.V | AEX Gold Inc | 0.01 | 0.18 | 0.18 |
| CAND.V | Candelaria Mining Corp | 2.17 | 0.83 | 0.32 |
| DTRC | Dakota Territory Resource Corp | 0 | -1.56 | -1.55 |
| ECR.V | Cartier Resources Inc | 0 | 1 | 0.99 |
| FISH.V | Sailfish Royalty Corp | 0.03 | 0.53 | 0.52 |
| MAU.V | Montage Gold Corp | 0 | 1.34 | 1.34 |
| MGM.V | Maple Gold Mines Ltd | 0.01 | -0.89 | -0.88 |
| MJS.V | Majestic Gold Corp | 0 | 0.39 | 0.39 |
| VLC.V | Velocity Minerals Ltd | 0.01 | 0.9 | 0.89 |
| VVC.V | VVC Exploration Corp | 0.19 | 0.39 | 0.34 |
| Low | High | |
| Unlevered beta | 0.32 | 0.39 |
| Relevered beta | 0.57 | 0.76 |
| Adjusted relevered beta | 0.71 | 0.84 |
XTG.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 XTG.TO:
cost_of_equity (8.05%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (0.71) + 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.