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Yiren Digital Ltd. (YRD) — WACC Analysis

WACC Breakdown

Yiren Digital Ltd. (YRD) has a weighted average cost of capital (WACC) of 14.5%. The cost of equity is 8.9%, derived from a beta of 1.00 and a risk-free rate of 4.7%. The after-tax cost of debt is 418.9%. The capital structure is 98.6% equity and 1.4% debt.

Interpretation

A WACC of 14.5% indicates that the market perceives Yiren Digital Ltd. as higher-risk, requiring a greater return to compensate investors.

Investors can compare YRD's WACC of 14.5% 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

YRD WACC: 14.46% for Yiren Digital Ltd.

Current inputs imply a 8.90% cost of equity and a 418.90% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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[02]
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

Yiren Digital Ltd. Common Stock (YRD) WACC Results
Weighted Average Cost of Capital
14.46%
Cost of Equity
8.90%
Risk-Free Rate4.67%
Beta1.00
Market Risk Premium4.23%
Cost of Debt
418.90%
Pre-Tax Cost of Debt418.90%
Tax Rate0.00%
Tax Shield0.00%
Capital Structure
Equity: 98.64%($94.49M)
Debt: 1.36%($1.30M)
Equity Component
8.78%
98.64% × 8.90%
Debt Component
5.68%
1.36% × 418.90%

Yiren Digital Ltd. (YRD) WACC in context

Yiren Digital Ltd. (YRD) currently screens with an estimated WACC of 14.46%. That blends a 8.90% cost of equity, a 418.90% pre-tax cost of debt, and a 98.64% 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 YRD WACC implies

A 14.46% discount rate screens as a relatively high discount rate, which makes valuation more sensitive to execution and capital structure risk.

How this page calculates YRD

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 98.64% 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.