EQH
Equitable Holdings Inc
Price:  
52.93 
USD
Volume:  
1,627,109
United States | Diversified Financial Services

EQH WACC - Weighted Average Cost of Capital

The WACC of Equitable Holdings Inc (EQH) is 6.7%.

The Cost of Equity of Equitable Holdings Inc (EQH) is 10.75%.
The Cost of Debt of Equitable Holdings Inc (EQH) is 4.4%.

RangeSelected
Cost of equity9.5% - 12.0%10.75%
Tax rate26.2% - 27.0%26.6%
Cost of debt4.0% - 4.8%4.4%
WACC6.0% - 7.4%6.7%
WACC

EQH WACC calculation

CategoryLowHigh
Long-term bond rate3.9%4.4%
Equity market risk premium4.6%5.6%
Adjusted beta1.221.27
Additional risk adjustments0.0%0.5%
Cost of equity9.5%12.0%
Tax rate26.2%27.0%
Debt/Equity ratio
1.171.17
Cost of debt4.0%4.8%
After-tax WACC6.0%7.4%
Selected WACC6.7%

EQH's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for EQH:

cost_of_equity (10.75%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (1.22) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.