The WACC calculator with live financial inputs.
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AAPLWeighted Average Cost of Capital
Implied discount rate - Annualized
The WACC calculator that actually pulls live data.
Every WACC is wrong to two decimals. The point of a sensitivity table is to show the range of possibilities for a given company. The current cell highlighted in orange.
| β \ ERP → | 3.50% | 4.50% | 5.50% | 6.50% | 7.50% |
|---|---|---|---|---|---|
| β = 0.60 | 6.38% | 6.96% | 7.54% | 8.13% | 8.71% |
| β = 0.90 | 7.40% | 8.27% | 9.15% | 10.02% | 10.90% |
| β = 1.20 | 8.42% | 9.59% | 10.75% | 11.92% | 13.09% |
| β = 1.50 | 9.44% | 10.90% | 12.36% | 13.82% | 15.28% |
| β = 1.80 | 10.46% | 12.21% | 13.96% | 15.71% | 17.46% |
What is WACC, really?
WACC is the combined cost a company pays to finance its assets, measured by how much of the capital structure comes from each source. In a DCF it serves as the discount rate that translates future free cash flows back into the present value. A higher WACC means the market demands more return for the risk that the business carries, which decreases the price investors will pay for those cash flows today.
The intuition is simple. Equity holders sit at the back of the line in bankruptcy and want compensation for that risk through expected returns. Debt holders sit at the front of the line but receive a fixed return, and the government effectively pays part of that coupon by making interest tax deductible. WACC mixes these two streams in proportion to their share of the firm's total enterprise value.
Why the weights use market values
The textbook insists on market value of equity and market value of debt for a reason. Book values reflect historical accounting choices that have nothing to do with what investors would pay to buy the company today. If you weight by book equity, you will systematically understate the cost of capital for any firm trading above book value, which is most of them. Use market cap for equity. For debt, book value is a reasonable proxy unless the firm has publicly traded bonds with observable yields, in which case use those.
Where the cost of equity actually comes from
The capital asset pricing model is the most common framework, even though academics have been pointing out its flaws since the 1980s. It survives because it produces a defensible number from three observable inputs: the risk free rate, the equity risk premium, and the stock's beta. The output is the return investors should rationally demand from this equity given its sensitivity to broad market moves.
One equation with five inputs
The whole equation is a weighted sum. Everything else is just figuring out the inputs.
AAPL's WACC, line by line
Using current market data as of May 2026. Numbers rounded for readability. The calculator above will produce the unrounded version.
AAPL Inc.
Cost of equity (CAPM)
Ke = 4.35% + 1.20 × 5.50% Ke = 4.35% + 6.60%
After tax cost of debt
Kd(1 - t) = 4.50% × 0.84
Capital structure weights
E = $3,400B · D = $96B · V = $3,496B We = 3,400 / 3,496 = 97.25% Wd = 96 / 3,496 = 2.75%
Blend to WACC
WACC = 0.9725 × 10.95% + 0.0275 × 3.78% WACC = 10.65% + 0.10%
Industry WACC ranges 2026
If your computed WACC sits outside the typical range for the sector, treat that as a signal to recheck inputs rather than a discovery.
Five mistakes that wreck your number
If your WACC feels off, it's almost always one of these.
Using book value of equity
Book equity has no economic meaning for valuation. Use market cap. A profitable firm trading at 5x book will see its WACC understated by 200 to 400 basis points if you weight it by book.
Forgetting the tax shield on debt
The cost of debt enters WACC after tax, because interest is tax deductible. Plugging in the pre tax yield directly will overstate WACC by tax rate times debt weight.
Mixing nominal and real rates
If you build cash flows in nominal terms (most analysts do), every input in WACC must also be nominal. Real risk free rates with nominal cash flows is a silent killer of valuations.
Using levered beta when you need unlevered
If you are computing WACC for a target with a different capital structure than the comparable companies, unlever and relever the beta. Otherwise you are mixing two different financial risk profiles.
Single point estimates
A single WACC number to two decimals is theater. Always run a sensitivity table on beta and ERP at minimum. A range from 8.5% to 10.5% is far more honest than 9.46%.
Stale risk free rate
The 10 year Treasury moves daily. A WACC built six months ago can be off by 100 basis points just from the rate environment. Refresh inputs whenever the rate cycle shifts.
Questions analysts actually ask.
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