HMMR WACC - Weighted Average Cost of Capital
The WACC of Hammer Fiber Optics Holdings Corp (HMMR) is 6.0%.
| Range | Selected | |
| Cost of equity | 5.5% - 7.1% | 6.3% |
| Tax rate | 26.2% - 27.0% | 26.6% |
| Cost of debt | 4.0% - 7.0% | 5.5% |
| WACC | 5.1% - 6.8% | 6.0% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.37 | 0.4 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 5.5% | 7.1% |
| Tax rate | 26.2% | 27.0% |
| Debt/Equity ratio | 0.19 | 0.19 |
| Cost of debt | 4.0% | 7.0% |
| After-tax WACC | 5.1% | 6.8% |
| Selected WACC | 6.0% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| HMMR | Hammer Fiber Optics Holdings Corp | 0.19 | -3.03 | -2.67 |
| DTGI | Digerati Technologies Inc | 30.85 | 0.64 | 0.03 |
| FUIG | Fusion Interactive Corp | 1053.12 | -1.09 | 0 |
| INTEQ | Intelsat SA | 2643.91 | -2.06 | 0 |
| LBTYA | Liberty Global PLC | 2.73 | 0.3 | 0.1 |
| LILA | Liberty Latin America Ltd | 8.13 | 0.61 | 0.09 |
| LUMN | Lumen Technologies Inc | 4.7 | 0.48 | 0.11 |
| PVSP | Pervasip Corp | 3.33 | 0.92 | 0.27 |
| SIFY | Sify Technologies Ltd | 0.93 | 0.1 | 0.06 |
| TGO.TO | Terago Inc | 1.98 | 0.29 | 0.12 |
| Low | High | |
| Unlevered beta | 0.05 | 0.09 |
| Relevered beta | 0.06 | 0.1 |
| Adjusted relevered beta | 0.37 | 0.4 |
HMMR'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 HMMR:
cost_of_equity (6.30%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.37) + 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.