Cost of Equity Calculator

Calculate your cost of equity with precision. Our calculator handles dividends and non-dividend scenarios effortlessly. Streamline your financial decisions now!

With Dividends

Result Cost of Equity (With Dividends) 0%

No Dividends

Result Real Rate of Return 0%

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Cost of Equity Formula

Formula based on CAPM model

Cost of Equity = Risk-Free Rate of Return + Beta * (Market Rate of Return - Risk-Free Rate of Return)

The formula based on the dividend capitalization model

Cost of Equity = (Dividend per share / Current market value) + Growth rate of dividend

Cost of Equity Definition

The cost of equity represents the rate of return required by investors to compensate for the risk of owning a company's stock.

For example, if you invest in a company with a cost of equity at 10%, you can anticipate a corresponding 10% annual return on your investment.