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GreenTree Hospitality Group Ltd. American depositary shares, each representing one Class A ordinary share (GHG) — WACC Analysis

WACC Breakdown

GreenTree Hospitality Group Ltd. American depositary shares, each representing one Class A ordinary share (GHG) has a weighted average cost of capital (WACC) of 6.1%. The cost of equity is 7.9%, derived from a beta of 0.58 and a risk-free rate of 4.8%. The after-tax cost of debt is 1.9%. The capital structure is 69.9% equity and 30.1% debt.

Interpretation

A WACC of 6.1% suggests that the market views GreenTree Hospitality Group Ltd. American depositary shares, each representing one Class A ordinary share as relatively low-risk, with a lower cost of financing.

Investors can compare GHG's WACC of 6.1% against industry peers to gauge its relative financing costs. A beta of 0.58 reflects the stock's volatility relative to the broader market.

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VALUATION

GHG WACC: 6.07% for GreenTree Hospitality Group Ltd. American depositary shares, each representing one Class A ordinary share

Current inputs imply a 7.88% cost of equity and a 2.38% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

GreenTree Hospitality Group Ltd. American depositary shares, each representing one Class A ordinary share Common Stock (GHG) WACC Results
Weighted Average Cost of Capital
6.07%
Cost of Equity
7.88%
Risk-Free Rate4.83%
Beta0.58
Market Risk Premium4.23%
Cost of Debt
1.88%
Pre-Tax Cost of Debt2.38%
Tax Rate21.00%
Tax Shield0.50%
Capital Structure
Equity: 69.92%($103.92M)
Debt: 30.08%($44.71M)
Equity Component
5.51%
69.92% × 7.88%
Debt Component
0.57%
30.08% × 1.88%

GreenTree Hospitality Group Ltd. American depositary shares, each representing one Class A ordinary share (GHG) WACC in context

GreenTree Hospitality Group Ltd. American depositary shares, each representing one Class A ordinary share (GHG) currently screens with an estimated WACC of 6.07%. That blends a 7.88% cost of equity, a 2.38% pre-tax cost of debt, and a 69.92% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What GHG WACC implies

A 6.07% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates GHG

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.58 and equity accounts for 69.92% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.