CRR.UN.TO WACC - Weighted Average Cost of Capital
The WACC of Crombie Real Estate Investment Trust (CRR.UN.TO) is 7.0%.
| Range | Selected | |
| Cost of equity | 8.8% - 12.2% | 10.5% |
| Tax rate | 0.0% - 0.1% | 0.05% |
| Cost of debt | 4.0% - 5.4% | 4.7% |
| WACC | 5.9% - 8.1% | 7.0% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 1.11 | 1.31 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 8.8% | 12.2% |
| Tax rate | 0.0% | 0.1% |
| Debt/Equity ratio | 1.47 | 1.47 |
| Cost of debt | 4.0% | 5.4% |
| After-tax WACC | 5.9% | 8.1% |
| Selected WACC | 7.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| CRR.UN.TO | Crombie Real Estate Investment Trust | 1.47 | 0.97 | 0.39 |
| AFIN | American Finance Trust Inc | 1.74 | 1.4 | 0.51 |
| BFS | Saul Centers Inc | 1.79 | 0.47 | 0.17 |
| CRT.UN.TO | CT Real Estate Investment Trust | 1.77 | 0.98 | 0.36 |
| HMG | HMG Courtland Properties Inc | 0.03 | 0.73 | 0.71 |
| IARE | Inventrust Properties Corp | 0.44 | 0.92 | 0.64 |
| KRG | Kite Realty Group Trust | 0.64 | 0.67 | 0.41 |
| RPAI | Retail Properties of America Inc | 0.62 | 1.74 | 1.08 |
| UBA | Urstadt Biddle Properties Inc | 0.4 | 0.79 | 0.56 |
| WRI | Weingarten Realty Investors | 0.46 | 1.61 | 1.1 |
| Low | High | |
| Unlevered beta | 0.47 | 0.59 |
| Relevered beta | 1.16 | 1.46 |
| Adjusted relevered beta | 1.11 | 1.31 |
CRR.UN.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 CRR.UN.TO:
cost_of_equity (10.50%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.11) + 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.