WACC Calculator | Weighted Average Cost of Capital

Q: How is WACC calculated?

WACC = (E/V) * Re + (D/V) * Rd * (1 - Tc).

Q: What is CAPM used for?

CAPM estimates cost of equity: Re = Rf + β * (Rm - Rf).

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Cost of Equity (Re %)

Cost of Debt (Rd %)

Corporate Tax Rate (%)

Market Value of Equity ($M)

Market Value of Debt ($M)

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Equity Weight 71.4%

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Weighted Average Cost of Capital

7.93%

🔵 Equity: 71.4% 🟠 Debt: 28.6%

Calculation Details

WACC = (E/V * Re) + (D/V * Rd * (1‑Tc))

📊 Industry Benchmarks (WACC)

Technology	8% – 12%
Financials	6% – 9%
Energy	7% – 11%
Consumer Staples	5% – 8%
Utilities	4% – 7%

🔥 Sensitivity Heatmap (WACC %)

Rows: Cost of Debt · Columns: Cost of Equity

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📘 What is WACC?

The Weighted Average Cost of Capital (WACC) represents a firm's average after‑tax cost of capital from all sources, including equity and debt. It is the minimum return a company must earn on its existing asset base to satisfy its investors.

❓ Frequently Asked Questions

How is WACC calculated?

WACC = (E/V) * Re + (D/V) * Rd * (1 - Tc), where E=equity value, D=debt value, V=E+D, Re=cost of equity, Rd=cost of debt, Tc=tax rate.

What is CAPM used for?

The Capital Asset Pricing Model estimates the cost of equity: Re = Rf + β * (Rm - Rf).

Why is the after‑tax cost of debt used?

Interest payments are tax‑deductible, creating a tax shield that lowers the effective cost of debt.

What is a typical WACC range?

Most companies have a WACC between 5% and 12%, depending on industry risk and capital structure.

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📘 What is WACC?

❓ Frequently Asked Questions