Canadian National Railway (Weighted Average Cost of Capital (WACC) Analysis)
 Improve your investment analysis with by seeing the Canadian National Railway's Discounted Cash Flow analysis, Canadian National Railway's Warren Buffet analysis, and Canadian National Railway's Comparable Multiple analysis.  Helpful Information for Canadian National Railway's AnalysisWhat is the WACC Formula? Analyst use the WACC Discount Rate (weighted average cost of capital) to determine Canadian National Railway's investment risk. WACC Formula = Cost of Equity (CAPM) * Common Equity + (Cost of Debt) * Total Debt. The result of this calculation is an essential input for the discounted cash flow (DCF) analysis for Canadian National Railway. Value Investing Importance? This method is widely used by investment professionals to determine the correct price for investments in Canadian National Railway before they make value investing decisions. This WACC analysis is used in Canadian National Railway's discounted cash flow (DCF) valuation and see how the WACC calculation affect's Canadian National Railway's company valuation. |
WACC Analysis Information1. The WACC (discount rate) calculation for Canadian National Railway uses comparable companies to produce a single WACC (discount rate). An industry average WACC (discount rate) is the most accurate for Canadian National Railway over the long term. If there are any short-term differences between the industry WACC and Canadian National Railway's WACC (discount rate), then Canadian National Railway is more likely to revert to the industry WACC (discount rate) over the long term. 2. The WACC calculation uses the higher of Canadian National Railway's WACC or the risk free rate, because no investment can have a cost of capital that is better than risk free. This situation may occur if the beta is negative and Canadian National Railway uses a significant proportion of equity capital. |
