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Snap Inc. (SNAP) — WACC Analysis

WACC Breakdown

Snap Inc. (SNAP) has a weighted average cost of capital (WACC) of 7.6%. The cost of equity is 9.0%, derived from a beta of 1.00 and a risk-free rate of 4.7%. The after-tax cost of debt is 4.1%. The capital structure is 72.2% equity and 27.8% debt.

Interpretation

A WACC of 7.6% suggests that the market views Snap Inc. as relatively low-risk, with a lower cost of financing.

Investors can compare SNAP's WACC of 7.6% against industry peers to gauge its relative financing costs. A beta of 1.00 reflects the stock's volatility relative to the broader market.

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VALUATION

SNAP WACC: 7.61% for Snap Inc.

Current inputs imply a 8.96% cost of equity and a 4.09% 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

Snap Inc. Common Stock (SNAP) WACC Results
Weighted Average Cost of Capital
7.61%
Cost of Equity
8.96%
Risk-Free Rate4.73%
Beta1.00
Market Risk Premium4.23%
Cost of Debt
4.09%
Pre-Tax Cost of Debt4.09%
Tax Rate0.00%
Tax Shield0.00%
Capital Structure
Equity: 72.21%($9183.20M)
Debt: 27.79%($3534.61M)
Equity Component
6.47%
72.21% × 8.96%
Debt Component
1.14%
27.79% × 4.09%

Snap Inc. (SNAP) WACC in context

Snap Inc. (SNAP) currently screens with an estimated WACC of 7.61%. That blends a 8.96% cost of equity, a 4.09% pre-tax cost of debt, and a 72.21% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What SNAP WACC implies

A 7.61% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates SNAP

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.00 and equity accounts for 72.21% 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.