MJ.CN WACC - Weighted Average Cost of Capital
The WACC of True Leaf Brands Inc (MJ.CN) is 5.4%.
| Range | Selected | |
| Cost of equity | 9.7% - 30.7% | 20.2% |
| Tax rate | 25.9% - 26.5% | 26.2% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 4.3% - 6.5% | 5.4% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 1.29 | 4.34 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.7% | 30.7% |
| Tax rate | 25.9% | 26.5% |
| Debt/Equity ratio | 8.68 | 8.68 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 4.3% | 6.5% |
| Selected WACC | 5.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MJ.CN | True Leaf Brands Inc | 8.68 | 1.01 | 0.14 |
| BSEM | Biostem Technologies Inc | 0.02 | 1.96 | 1.93 |
| CPMD | CannaPharmaRx Inc | 2.16 | -1.06 | -0.41 |
| GNOM.CN | Gnomestar Craft Inc | 2.36 | 1.84 | 0.67 |
| KOAN | Resonate Blends Inc | 27.07 | 0.55 | 0.03 |
| MLCL.CN | Molecule Holdings Inc | 10.9 | 1.39 | 0.15 |
| MMJ.CN | Matica Enterprises Inc | 0.17 | 1.15 | 1.02 |
| POT.CN | Weekend Unlimited Industries Inc | 0.02 | 1.5 | 1.48 |
| SNES | Senestech Inc | 0.05 | 1.78 | 1.71 |
| SPR.CN | Sproutly Canada Inc | 1.34 | 0.44 | 0.22 |
| Low | High | |
| Unlevered beta | 0.19 | 0.81 |
| Relevered beta | 1.43 | 5.99 |
| Adjusted relevered beta | 1.29 | 4.34 |
MJ.CN'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 MJ.CN:
cost_of_equity (20.20%) = risk_free_rate (3.45%) + equity_risk_premium (5.60%) * adjusted_beta (1.29) + 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.