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WACC Calculator

Cost of equity (CAPM) + after-tax cost of debt, weighted by capital structure. The discount rate for any DCF.

Inputs
Cost of Equity (CAPM)
Risk-free rate (10Y UST)
Levered beta (5-yr)
Equity risk premium
Cost of Debt
Pre-tax cost of debt
Effective tax rate
Capital Structure ($mm)
Market cap (equity, E)
Total debt (D)
Weighted Average Cost of Capital
โ€”
Use this as your DCF discount rate.
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How this works

Cost of equity (Re) = Rf + ฮฒ ร— ERP. The Capital Asset Pricing Model. ฮฒ captures how much the stock moves with the market; ERP is the extra return investors demand for taking equity risk over treasuries.

After-tax cost of debt (Rd) = pre-tax rate ร— (1 โˆ’ tax rate). Interest is tax-deductible, so debt financing has a built-in tax shield.

WACC = (E รท V) ร— Re + (D รท V) ร— Rd, where V = E + D. Weight each cost by its share of total capital.

Typical ranges: large-cap tech 8โ€“12%, defensive consumer 6โ€“9%, levered cyclicals 10โ€“14%, biotech 12โ€“16%. If your number is outside its typical range for the sector, double-check beta and capital structure.

Use this for: the discount rate in your DCF (see DCF calculator), measuring whether ROIC > WACC (value creation), and computing economic profit (NOPAT โˆ’ WACC ร— invested capital).

Need WACC computed for any ticker automatically?

The full toolkit pulls beta, capital structure, and tax rate from Yahoo Finance for any ticker. WACC tab updates instantly. Ties into the Mini DCF tab and Football Field for full intrinsic-value analysis.

โ†’ See the full toolkit

Nothing on this page is investment advice. Built by Brandon Leon โ€” independent research focused on cyclical industries.

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