NTST WACC - Weighted Average Cost of Capital
The WACC of Netstreit Corp (NTST) is 6.9%.
| Range | Selected | |
| Cost of equity | 6.2% - 8.3% | 7.25% |
| Tax rate | 0.6% - 1.2% | 0.9% |
| Cost of debt | 4.0% - 9.1% | 6.55% |
| WACC | 5.3% - 8.6% | 6.9% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.51 | 0.61 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.2% | 8.3% |
| Tax rate | 0.6% | 1.2% |
| Debt/Equity ratio | 0.66 | 0.66 |
| Cost of debt | 4.0% | 9.1% |
| After-tax WACC | 5.3% | 8.6% |
| Selected WACC | 6.9% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| NTST | Netstreit Corp | 0.66 | 0.34 | 0.21 |
| CBLAQ | CBL & Associates Properties Inc | 34.64 | 1.35 | 0.04 |
| GTY | Getty Realty Corp | 0.57 | 0.09 | 0.06 |
| PLZ.UN.TO | Plaza Retail REIT | 1.58 | 0.88 | 0.34 |
| RPT | RPT Realty | 5.64 | 0.64 | 0.1 |
| SGR.UN.TO | Slate Grocery REIT | 1.88 | 0.92 | 0.32 |
| SRG | Seritage Growth Properties | 1.44 | 0.67 | 0.28 |
| UBA | Urstadt Biddle Properties Inc | 0.4 | 0.79 | 0.56 |
| WPG | Washington Prime Group Inc | 153.93 | 1.55 | 0.01 |
| WSR | Whitestone REIT | 0.49 | 0.36 | 0.24 |
| Low | High | |
| Unlevered beta | 0.16 | 0.25 |
| Relevered beta | 0.27 | 0.42 |
| Adjusted relevered beta | 0.51 | 0.61 |
NTST'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 NTST:
cost_of_equity (7.25%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.51) + 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.