Online Calculators > Financial Calculators > Cost of Equity Calculator
Cost of Equity Calculator
Cost of Equity Calculator calculate the cost of equity using dividend growth, market value of stock and dividends per share. Cost of equity is the rate of return an investor requires for investing in a company.
The Cost of Equity Formula below shows you how to calculate cost of equity manually.
Cost of Equity Formula
The following Cost of Equity Formula shows how to calculate cost of equity.
Cost of Equity = Dividends Per Share/Market Value Stock + Dividend Growth Rate
How to Calculate Cost of Equity
To apply the cost of equity formula, we need dividends per share, market value of the stock and growth rate. For example, if a company is paying $1.5 dividends per share and the market
value of the stock is $15 with a dividend growth rate of 3%, we will plugin the data to the our formula.
Cost of Equity = 1.5/15 + 0.03 = 13.00%
