Teekay LNG Partners LP (TGP) WACC Analysis

As of May 25, 2025, Teekay LNG Partners LP (TGP) carries a Weighted Average Cost of Capital (WACC) of 7.3%. WACC reflects the blended rate Teekay LNG Partners LP must pay to both equity and debt holders.

Within that, the cost of equity is 5.3%, the cost of debt is 5.7%, and the effective tax rate is 2.7%.

Breakdown of WACC Components

• Long-term bond rate: 3.2% – 3.7%
• Equity market risk premium: 4.2% – 5.2%
• Adjusted beta: 0.38 – 0.96
• Additional risk adjustment: 0.5% – 1.0%
• Debt-to-equity ratio: 1.91

What It Means for Investors

With a selected WACC of 7.3%, Teekay LNG Partners LP must ensure any new investment returns exceed this threshold to generate shareholder value. This level reflects an attractive low cost of capital.