ULTRF WACC - Weighted Average Cost of Capital
The WACC of Ultrapetrol (Bahamas) Ltd (ULTRF) is 5.5%.
| Range | Selected | |
| Cost of equity | 3.0% - 1750.2% | 876.6% |
| Tax rate | 9.9% - 12.5% | 11.2% |
| Cost of debt | 5.4% - 7.0% | 6.2% |
| WACC | 4.8% - 6.2% | 5.5% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | -379.21 | 0.33 |
| Additional risk adjustments | 1743.5% | 1744.0% |
| Cost of equity | 3.0% | 1750.2% |
| Tax rate | 9.9% | 12.5% |
| Debt/Equity ratio | 32169.47 | 32169.47 |
| Cost of debt | 5.4% | 7.0% |
| After-tax WACC | 4.8% | 6.2% |
| Selected WACC | 5.5% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ULTRF | Ultrapetrol (Bahamas) Ltd | 32169.47 | 17.01 | 0 |
| AWRY | Allegheny and Western Railway Co | 0.5 | -0.09 | -0.06 |
| CHTH | CNL Healthcare Properties Inc | 0.9 | -0.15 | -0.08 |
| CWPE | CW Petroleum Corp | 3.44 | 1.85 | 0.45 |
| HNFSA | Hanover Foods Corp | 3.31 | -0.38 | -0.1 |
| HSTI | High Sierra Technologies Inc | 0.02 | -0.27 | -0.27 |
| SGRZ | Stonepath Group Inc | 0.4 | 0 | 0 |
| SHWK | Seahawk Deep Ocean Technology Inc | 2.32 | 0 | 0 |
| Low | High | |
| Unlevered beta | -0.07 | 0 |
| Relevered beta | -566.48 | 0 |
| Adjusted relevered beta | -379.21 | 0.33 |
ULTRF'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 ULTRF:
cost_of_equity (876.60%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (-379.21) + risk_adjustments (1,743.75%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.