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About WACC Calculator Online
This tool calculates the Weighted Average Cost of Capital (WACC) — the average rate a company pays to finance its assets, blending the cost of equity and the cost of debt according to the proportion of each in the capital structure. Provide the market value of equity and debt, the cost of equity, the cost of debt, and the tax rate.
WACC is the discount rate analysts use in DCF (discounted cash flow) valuation. Any project or investment a company makes must earn a return above WACC, or it destroys value. Companies with cheaper financing (low WACC) have a structural advantage in capital allocation.
The tool reflects the tax-shield effect of debt: because interest is deductible, the after-tax cost of debt is lower than the gross rate paid to lenders, slightly lowering WACC.
How to use this tool
How to compute the weighted average cost of capital (WACC)
Equity and debt values
"Equity value" is the market value of equity (market cap for public companies; fair value estimate for private). "Debt value" is the value of interest-bearing debt — book if you don't have market debt prices.
Cost of equity and pre-tax debt
"Cost of equity %" is the required return on equity (CAPM or comparable). "Cost of debt % (pre-tax)" is the all-in yield on the debt before any tax shield.
Tax rate
"Tax rate %" is the marginal corporate tax rate. The formula applies the (1 − tc) shield only to debt — equity is already after-tax in the cost-of-equity figure.
Press Run
Result is waccPercent = (E/V × re) + (D/V × rd × (1 − tc)) × 100, rounded to 4 decimals. Total V = E + D = 0 throws "Total value cannot be 0." — there's nothing to weight.