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Tractor Supply Co (TSCO) — WACC Analysis

WACC Breakdown

Tractor Supply Co (TSCO) has a weighted average cost of capital (WACC) of 7.8%. The cost of equity is 8.4%, derived from a beta of 0.73 and a risk-free rate of 5.0%. The after-tax cost of debt is 2.5%. The capital structure is 89.1% equity and 10.9% debt.

Interpretation

A WACC of 7.8% suggests that the market views Tractor Supply Co as relatively low-risk, with a lower cost of financing.

Investors can compare TSCO's WACC of 7.8% against industry peers to gauge its relative financing costs. A beta of 0.73 reflects the stock's volatility relative to the broader market.

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VALUATION

TSCO WACC: 7.78% for Tractor Supply Co

Current inputs imply a 8.43% cost of equity and a 3.14% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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[02]
WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

Tractor Supply Co Common Stock (TSCO) WACC Results
Weighted Average Cost of Capital
7.78%
Cost of Equity
8.43%
Risk-Free Rate4.96%
Beta0.73
Market Risk Premium4.23%
Cost of Debt
2.48%
Pre-Tax Cost of Debt3.14%
Tax Rate21.00%
Tax Shield0.66%
Capital Structure
Equity: 89.11%($17.63B)
Debt: 10.89%($2153.83M)
Equity Component
7.51%
89.11% × 8.43%
Debt Component
0.27%
10.89% × 2.48%

Tractor Supply Co (TSCO) WACC in context

Tractor Supply Co (TSCO) currently screens with an estimated WACC of 7.78%. That blends a 8.43% cost of equity, a 3.14% pre-tax cost of debt, and a 89.11% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What TSCO WACC implies

A 7.78% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates TSCO

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.73 and equity accounts for 89.11% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.