Unlevered Beta Calculator
The Unlevered Beta Calculator is an essential tool for investors, financial analysts, and corporate finance professionals. It helps in determining the systematic risk of a company’s equity without the impact of its debt. This metric is crucial for assessing the true risk of a company’s assets.
What is Unlevered Beta?
Unlevered Beta, also known as asset beta, measures the risk of a company’s assets compared to the overall market. Unlike the regular beta, it excludes the effects of debt, making it a useful measure to compare companies with varying capital structures.
Unlevered Beta Calculator
Formula for Unlevered Beta
The formula to calculate unlevered beta is as follows:
Unlevered Beta = Levered Beta / [1 + ((1 - Tax Rate) * (Debt / Equity))]
Steps to Calculate Unlevered Beta
Here is a step-by-step guide:
- Obtain the levered beta (usually provided by financial data sources).
- Determine the company’s debt-to-equity ratio.
- Find the corporate tax rate of the company.
- Apply the values to the unlevered beta formula.
Why Use an Unlevered Beta Calculator?
Manually calculating unlevered beta can be time-consuming and error-prone. An online calculator simplifies the process, ensuring accurate results in seconds. It’s particularly useful for:
- Comparing the risk of different companies without the influence of debt.
- Valuing businesses or projects for mergers and acquisitions.
- Performing equity research and investment analysis.
Try Our Free Unlevered Beta Calculator
Our free Unlevered Beta Calculator lets you calculate the unlevered beta effortlessly. Just input the levered beta, tax rate, and debt-to-equity ratio, and get accurate results instantly.
Key Features
- Easy to use interface
- Fast and reliable calculations
- Free and accessible from any device