TRCNF WACC - Weighted Average Cost of Capital
The WACC of Transnational Cannabis Ltd (TRCNF) is 7.4%.
| Range | Selected | |
| Cost of equity | 5.9% - 11.6% | 8.75% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.3% - 9.5% | 7.4% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.45 | 1.21 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.9% | 11.6% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.37 | 0.37 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.3% | 9.5% |
| Selected WACC | 7.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| TRCNF | Transnational Cannabis Ltd | 0.37 | 1585.08 | 1245.65 |
| ACAN | Americann Inc | 2083.5 | -1.17 | 0 |
| BSEM | Biostem Technologies Inc | 0.02 | 1.88 | 1.85 |
| CBDY | Target Group Inc | 9.29 | 1.07 | 0.14 |
| CPMD | CannaPharmaRx Inc | 3.02 | -0.7 | -0.22 |
| IVHI | Invech Holdings Inc | 0.08 | 1.14 | 1.08 |
| MJ.CN | True Leaf Brands Inc | 8.68 | 1.01 | 0.14 |
| MMJ.CN | Matica Enterprises Inc | 0.17 | 1.15 | 1.02 |
| NPTX | Neuropathix Inc | 67.83 | 1.83 | 0.04 |
| SNES | Senestech Inc | 0.02 | 2.07 | 2.04 |
| VIN.CN | Vinergy Capital Inc | 0.02 | 1.06 | 1.05 |
| Low | High | |
| Unlevered beta | 0.14 | 1.05 |
| Relevered beta | 0.18 | 1.31 |
| Adjusted relevered beta | 0.45 | 1.21 |
TRCNF'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 TRCNF:
cost_of_equity (8.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.45) + 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.