⚖️ WACC Calculator – Weighted Average Cost of Capital
Calculate a company’s Weighted Average Cost of Capital (WACC), the blended rate it pays to finance its assets through equity and debt.
What is WACC?
Weighted Average Cost of Capital (WACC) represents the average rate a company is expected to pay to all its investors, both shareholders and lenders, to finance its assets. It’s commonly used as the discount rate in valuation models.
The formula
WACC = (E/V × Cost of Equity) + (D/V × Cost of Debt × (1 – Tax Rate)), where E is the market value of equity, D is the market value of debt, and V = E + D. Debt’s cost is reduced by the tax rate because interest payments are typically tax-deductible.
This tool is for general educational purposes. Estimating cost of equity and cost of debt involves judgment and market assumptions, so treat the result as an approximation used for modeling, not precise guidance.