Wacc Calculator

WACC Calculator

Free Online Tools No Limitation No Registration

Calculate your company's Weighted Average Cost of Capital (WACC) with ease using our advanced calculator.

How to Calculate WACC?

Enter Financial Data

Input your company's equity value, debt value, and respective costs along with the tax rate.

Calculate

Click the 'Calculate WACC' button to instantly compute your weighted average cost of capital.

View Results

Get your WACC percentage instantly and use it for investment decisions and valuation analysis.

WACC Calculator – Accurate Weighted Average Cost of Capital Calculation

This WACC Calculator is a powerful financial tool designed for investors, analysts, business owners, and finance students who need fast and accurate WACC calculation. By adjusting the inputs such as Risk-Free Rate, Cost of Debt, Beta, Market Return, Tax Rate, Equity Value, and Debt Value, you can instantly determine your company’s true cost of capital. This tool follows standard US financial practices and is ideal for corporate finance and valuation.

What Is WACC?

WACC (Weighted Average Cost of Capital) represents the average return a company must earn to satisfy its investors—both equity holders and debt holders. If you are searching for how to calculate WACC or how do you calculate WACC, this guide and calculator will show you everything step by step.

WACC Formula

WACC = (E / V) × Re  +  (D / V) × Rd × (1 – Tc)

E = Equity Value
D = Debt Value
V = Total Capital (E + D)
Re = Cost of Equity
Rd = Cost of Debt
Tc = Corporate Tax Rate

This formula is the foundation for anyone looking to calculate WACC manually, but our automated calculate WACC calculator makes the entire process effortless.

WACC Input Fields Explained

1. Risk-Free Rate

The Risk-Free Rate represents the expected return on a zero-risk US security, usually the 10-year US Treasury yield. It is a key component in calculating the Cost of Equity using the CAPM model.

2. Cost of Debt

This percentage represents the interest rate a company pays on its debt. The calculator automatically adjusts for the tax benefit using the after-tax cost of debt formula.

3. Beta

Beta measures a company’s stock volatility compared to the overall US market. A Beta above 1 means higher risk; below 1 means lower risk. Beta is crucial for determining the Cost of Equity.

4. Market Return

The expected annual return of the US stock market. This is used along with the Risk-Free Rate to calculate Equity Risk Premium.

5. Tax Rate

The US corporate federal tax rate—commonly 21% or company-specific effective tax rates. The calculator uses this value to adjust the cost of debt.

6. Equity Value ($)

The total dollar value of a company’s equity. Used to calculate the weight of equity in the capital structure.

7. Debt Value ($)

The total dollar value of the company’s debt. Used to calculate the weight of debt in the WACC formula.

How to Calculate WACC (Step-by-Step)

If you're wondering how do I calculate WACC, follow these simple steps:

Adjust the Risk-Free Rate slider.
Set your company’s Cost of Debt.
Enter the company Beta.
Set the expected Market Return.
Choose your Tax Rate.
Enter Equity Value in USD.
Enter Debt Value in USD.
Click "Calculate" to get your WACC instantly.

Check More:Canada Postal Code Finder

These steps completely cover all variations of user intent, including how to calculate WACC, calculate WACC, calculating WACC, and calculator WACC.

WACC Calculation Example

Example Inputs:

Equity Value: $8,000,000
Debt Value: $2,000,000
Risk-Free Rate: 4.15%
Cost of Debt: 6.2%
Beta: 1.1
Market Return: 7%
Tax Rate: 25%

Step 1: Cost of Equity (Re)
Re = Risk-Free Rate + Beta × (Market Return – Risk-Free Rate) Re = 4.15% + 1.1 × (7% – 4.15%) Re = 7.285%

Step 2: After-Tax Cost of Debt (Rd)
Rd = 6.2% × (1 – 0.25) Rd = 4.65%

Step 3: Capital Weights
Total Value V = 8,000,000 + 2,000,000 = 10,000,000 Equity Weight = 8M / 10M = 0.8 Debt Weight = 2M / 10M = 0.2

Final WACC:

WACC = (0.8 × 7.285%) + (0.2 × 4.65%)
WACC = 5.828% + 0.93%
WACC = 6.758%

Why Use Our WACC Calculator?

Accurate US-based financial calculations
Instant WACC results with interactive sliders
CAPM-driven Cost of Equity formula
Ideal for corporate valuation, DCF analysis, and financial modeling
Simple interface for beginners and professionals

Check: Phone Validation Checker

Frequently Asked Questions (FAQ)

1. How do you calculate WACC?

WACC is calculated using the formula: (E/V × Re) + (D/V × Rd × (1 – Tc)). But the easiest way is to use our WACC calculator.

2. What inputs do I need for WACC?

You need the Risk-Free Rate, Cost of Debt, Beta, Market Return, Tax Rate, Equity Value, and Debt Value.

3. Is WACC important for US businesses?

Yes. WACC is essential for valuation, investment decisions, and financial planning. It acts as the discount rate for DCF models.

4. What does a high WACC mean?

A high WACC indicates higher risk and higher expected returns from investors.

5. Can I calculate WACC without formulas?

Absolutely. Our calculate WACC calculator does all the math automatically.