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Hope Bancorp, Inc. (HOPE) — WACC Analysis

WACC Breakdown

Hope Bancorp, Inc. (HOPE) has a weighted average cost of capital (WACC) of 10.3%. The cost of equity is 9.2%, derived from a beta of 1.00 and a risk-free rate of 5.0%. The after-tax cost of debt is 14.7%. The capital structure is 79.2% equity and 20.8% debt.

Interpretation

A WACC of 10.3% is moderate, reflecting the market's balanced risk assessment of Hope Bancorp, Inc..

Investors can compare HOPE's WACC of 10.3% against industry peers to gauge its relative financing costs. A beta of 1.00 reflects the stock's volatility relative to the broader market.

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VALUATION

HOPE WACC: 10.35% for Hope Bancorp, Inc.

Current inputs imply a 9.19% cost of equity and a 18.67% 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

Hope Bancorp, Inc. Common Stock (HOPE) WACC Results
Weighted Average Cost of Capital
10.35%
Cost of Equity
9.19%
Risk-Free Rate4.96%
Beta1.00
Market Risk Premium4.23%
Cost of Debt
14.75%
Pre-Tax Cost of Debt18.67%
Tax Rate21.00%
Tax Shield3.92%
Capital Structure
Equity: 79.18%($1794.77M)
Debt: 20.82%($472.00M)
Equity Component
7.28%
79.18% × 9.19%
Debt Component
3.07%
20.82% × 14.75%

Hope Bancorp, Inc. (HOPE) WACC in context

Hope Bancorp, Inc. (HOPE) currently screens with an estimated WACC of 10.35%. That blends a 9.19% cost of equity, a 18.67% pre-tax cost of debt, and a 79.18% equity weight into the discount rate you would typically use in a DCF model.

falls into a common range for established public companies and is a practical DCF starting point.

What HOPE WACC implies

A 10.35% discount rate falls into a common range for established public companies and is a practical DCF starting point.

How this page calculates HOPE

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.00 and equity accounts for 79.18% 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.