HSON WACC - Weighted Average Cost of Capital
The WACC of Hudson Global Inc (HSON) is 6.2%.
| Range | Selected | |
| Cost of equity | 6.8% - 10.6% | 8.7% |
| Tax rate | 25.0% - 30.3% | 27.65% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 5.3% - 7.0% | 6.2% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.65 | 1.02 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.8% | 10.6% |
| Tax rate | 25.0% | 30.3% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 5.3% | 7.0% |
| Selected WACC | 6.2% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| HSON | Hudson Global Inc | 1.17 | 0.74 | 0.4 |
| CTPR | CTPartners Executive Search Inc | 1.1 | 0.02 | 0.01 |
| CWL.TO | Caldwell Partners International Inc | 0.31 | -0.62 | -0.51 |
| HQI | Hirequest Inc | 0.05 | 0.47 | 0.45 |
| JOB | GEE Group Inc | 0.01 | 0.54 | 0.54 |
| KFY | Korn Ferry | 0.11 | 1 | 0.92 |
| STJO | St Joseph Inc | 0.17 | -1.05 | -0.93 |
| TBI | TrueBlue Inc | 0.05 | 0.69 | 0.66 |
| TNET | TriNet Group Inc | 0.24 | 0.89 | 0.75 |
| PRP.L | Prime People PLC | 0.36 | 1.88 | 1.49 |
| Low | High | |
| Unlevered beta | 0.43 | 0.59 |
| Relevered beta | 0.48 | 1.03 |
| Adjusted relevered beta | 0.65 | 1.02 |
HSON'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 HSON:
cost_of_equity (8.70%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.65) + 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.