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Nvidia Corp (NVDA) — WACC Analysis

WACC Breakdown

Nvidia Corp (NVDA) has a weighted average cost of capital (WACC) of 12.1%. The cost of equity is 12.1%, derived from a beta of 2.12 and a risk-free rate of 4.7%. The after-tax cost of debt is 2.8%. The capital structure is 99.8% equity and 0.2% debt.

Interpretation

A WACC of 12.1% indicates that the market perceives Nvidia Corp as higher-risk, requiring a greater return to compensate investors.

Investors can compare NVDA's WACC of 12.1% against industry peers to gauge its relative financing costs. A beta of 2.12 reflects the stock's volatility relative to the broader market.

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VALUATION

NVDA WACC: 12.11% for Nvidia Corp

Current inputs imply a 12.13% cost of equity and a 3.52% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

Nvidia Corp Common Stock (NVDA) WACC Results
Weighted Average Cost of Capital
12.11%
Cost of Equity
12.13%
Risk-Free Rate4.74%
Beta2.12
Market Risk Premium4.23%
Cost of Debt
2.78%
Pre-Tax Cost of Debt3.52%
Tax Rate21.00%
Tax Shield0.74%
Capital Structure
Equity: 99.84%($5200.73B)
Debt: 0.16%($8470.00M)
Equity Component
12.11%
99.84% × 12.13%
Debt Component
0.00%
0.16% × 2.78%

Nvidia Corp (NVDA) WACC in context

Nvidia Corp (NVDA) currently screens with an estimated WACC of 12.11%. That blends a 12.13% cost of equity, a 3.52% pre-tax cost of debt, and a 99.84% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

What NVDA WACC implies

A 12.11% discount rate screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

How this page calculates NVDA

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 2.12 and equity accounts for 99.84% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.