HUSN WACC - Weighted Average Cost of Capital
The WACC of Hudson Capital Inc. (HUSN) is 7.3%.
| Range | Selected | |
| Cost of equity | 7.4% - 11.8% | 9.6% |
| Tax rate | 0.0% - 1.0% | 0.5% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 6.2% - 8.4% | 7.3% |
| Category | Low | High |
| Long-term bond rate | 3.2% | 3.7% |
| Equity market risk premium | 4.2% | 5.2% |
| Adjusted beta | 0.99 | 1.45 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 7.4% | 11.8% |
| Tax rate | 0.0% | 1.0% |
| Debt/Equity ratio | 1 | 1 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 6.2% | 8.4% |
| Selected WACC | 7.3% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| HUSN | Hudson Capital Inc. | 1.08 | 2.2 | 1.06 |
| ACD.TO | Accord Financial Corp | 15.36 | 0.6 | 0.04 |
| BCF.V | Builders Capital Mortgage Corp | 0.17 | 0.27 | 0.23 |
| BLX | Foreign Trade Bank of Latin America Inc | 3.05 | 0.75 | 0.19 |
| CFGX | Capital Financial Global Inc | 308.83 | -51.31 | -0.17 |
| DXF | Dunxin Financial Holdings Ltd | 19.17 | 9.75 | 0.48 |
| ECN.TO | ECN Capital Corp | 0.97 | 1.02 | 0.52 |
| IOU.V | Iou Financial Inc | 0.25 | 0.64 | 0.51 |
| LMFA | LM Funding America Inc | 0.75 | 2.82 | 1.61 |
| SFI.V | Solution Financial Inc | 0.34 | 0.94 | 0.7 |
| SUND | Sundance Strategies Inc | 0.21 | 0.2 | 0.16 |
| Low | High | |
| Unlevered beta | 0.23 | 0.51 |
| Relevered beta | 0.99 | 1.67 |
| Adjusted relevered beta | 0.99 | 1.45 |
HUSN'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 HUSN:
cost_of_equity (9.60%) = risk_free_rate (3.45%) + equity_risk_premium (4.70%) * adjusted_beta (0.99) + 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.