11 Best Online Equity Calculator Websites
For every professional, the cost of equity is extremely important. It determines the stock valuation and the value of any investment the company might experience.
Each investor strives for the investment to be at least the cost of equity.
In other words, if someone invests in a company or project, they’d like their money to grow at least that much. Since all investments take place for mutual benefit, equity costs must be appealing to potential investors.
In general, the riskier the investment, the higher the cost. Let’s see what websites showcase the best equity calculators.
[Source: Unsplash]
What is The Cost of Equity?
Businesses use the cost of equity to determine if an investment meets capital return criteria. For the needed rate of return in capital planning, businesses frequently use it as a threshold. In other words, it is the compensation a company pays to its investors for taking all that risk.
The cost of equity varies from business to business. To calculate it, we must understand what it consists of.
– Equities are the difference between an asset’s value and its liabilities. It’s the money that would be given back following the sale of assets and settlement of debts.
– The required rate of return is the lowest rate an investor anticipates earning as a result of their investment. This rate, also called the hurdle rate, is subject to change as well, depending on the risk taken.
How to Calculate the Equity?
There are two ways a company can calculate the cost of equity. Depending on whether your company pays dividends to the investors or not, you can choose between the following:
– Dividend Discount Model (DDM) or Gordon Growth Model (GGM) is used when a company pays dividends to its investors. This model is practical, and it is often used for stock selection when the value of the stock dividend is yet to be determined. It is consistent with the yearly dividends, current share price, and dividend growth rate.
– Capital Asset Pricing Model (CAPM) is often used as an alternative to DDM since not many companies pay dividends. It is also a model often used with analytics and accountants since it is more precise. It consists of the gain or loss an investor might have compared to the real cost, the no-risk return, and the risk taken with the wider market.
What Online Equity Calculator Websites Can You Use?
Calculating the cost of equity is a common practice in every business. Therefore, many websites can help businesses determine their cost of equity by simply using online calculators for free. There are many preferences when it comes to finding the right website.
Professional sites are easy to spot. They are suitable for a wide range of businesses, accessible and fast, and have a presentable homepage created by professionals well-versed in website design for financial advisors.
Here are some of the handy calculator websites:
- Omnicalculator
Omnicalculator.com is one of the most popular and free internet calculators. It has a wide range of options and tools, along with cost equity calculation.
Simple access makes it easy to find the type of service you need. In addition, it is suitable for calculation with both CAPM and DDM models and therefore has a wide application.
The website itself contains details about the cost of equity as well as the procedures employed in calculating it. It is appropriate for everyone who is still in need of help in this process.
- Online Calculator
Another free website that offers a large number of options is online-calculator.org. Not only is it suitable for cost equity calculation but also for investors who can easily determine the cost of stakes.
You can find a variety of business-related material, as well as guidance on how to manage a business and improve your education.
Unlike the Omnicalculator, it does not support cost equity calculation for companies that pay dividends.
[Source: Pixabay]
- Calculator Academy
Calculator.academy is another free website that solely calculates the cost of equity for businesses that do not distribute dividends to investors.
The site itself is relatively bewildering and plain and contains fewer options than the above-mentioned sites. It contains information about the formulas they apply for the calculation and is more suitable for more experienced businesses.
- Code Beautify
Codebeautify.org is not a typical online calculator. Its main goals are code formatting and beautifying. There are also a lot of programming alternatives available, as well as a variety of business calculators.
This website enables the CAPM and DDM models for the cost of equity calculation. There is also information about the calculation itself, its goal, and a description of the formulas that were utilized.
Code Beautify also offers the option of copying the link so that the calculation can be forwarded and saved.
- Mini Web Tool
Among other websites, the miniwebtool.com calculator may be the one that focuses the most on performing financial calculations.
There is very little information required to use this useful and straightforward website. It is also appropriate for businesses that distribute dividends. Another perk: it has a wide range of financial applications and provides convenient mobile phone access.
- Stable Bread
Stablebread.com is perhaps the most modest site on this list, considering the options it offers. It is focused on loans, finance, annuities, investments, and personal finance. It has a calculator for CAPM and DDM calculations. The site is basic, visual, and fast to use.
The disadvantage of Stable Bread would be the impossibility of copying the link or saving the performed calculations. Also, the site doesn’t provide any information about the equity or dividend formula being used in the process. It is highly recommended for experienced business owners.
- Calculator Online
It is possible to calculate the cost of equity using Calculator-online.net as another free site. The options for the calculator are divided by categories, so you need to click on multiple links to access the desired calculator.
The site also offers both methods of calculating the cost of equity, regardless of whether dividends have been paid or not. You can save the results as a PDF document, which is another option offered by the site.
- Techdoct
Techdoct.com is the most complex site on this list. It is based on the QA method, and if you want to find certain information, it is best to directly type the desired item. It provides a wide range of information and documentation.
The formulas used and other information related to the cost of equity can be found on the calculator itself. It is specific in that it contains the option of contacting and leaving comments.
Techdoct supports both CAPM and DDM calculation models but does not have the option to save or forward results.
- Good Calculators
Goodcalculators.com is a free website that can be used to calculate both CAPM and DDM models. The site is well organized and consists of numerous calculators sorted by categories.
Compared to other sites, the DDM model requires a little bit more information to perform the calculation.
On the website, you can find additional information about the cost of equity, as well as an explanation of how the result was reached. The site does not offer the option of saving the received data or forwarding it.
[Source: Pixabay]
- Exploring Finance
Exploringfinance.com is one of the simplest and quickest ways to use a financial calculator. Although it only has a limited number of calculators and operations, it’s very simple and straightforward. The site only uses the CAPM calculation model.
It is a good choice for those with a greater understanding of business because it contains no additional information about equity costs but simply formulas that can be used to obtain data, along with some examples to make it easier to understand how they work.
- DQYDJ
Dqydj.com is a site dedicated to a large number of categories, among which calculators from the field of finance dominate. This site also supports calculation with the DDM model, which in this case is recognized as the GGM calculation model.
DQYDJ offers very extensive access to information related to the cost of equity and offers advanced options. The site is very suitable for startup companies and those new to the business because it is very detailed and trustworthy.
Conclusion
There are numerous financial calculators available online. You might find the perfect calculator for your needs depending on the task you pursue and the strategy you use.
To perform all the calculations in one location, it would be ideal if we could discover one that completely covers our sphere of business. It is crucial to remember that the data we enter to determine the cost of equity can also be determined using other calculators on the provided website.
When making a decision, other parameters such as ease of access, speed, and quality are also important, but how well the user is taken care of can be one of the strongest assets.
Ultimately, it is important to select a calculator that will benefit your business and enhance the strategies you employ.
