Unlevered Beta Calculator

Calculate unlevered beta for stock analysis.

Unlevered Beta Calculator

The beta with financial leverage

Corporate tax rate as a percentage

Debt divided by equity

Or enter debt and equity values separately:

Calculation Results

Unlevered Beta (βU)

Effective D/E Ratio

Tax Shield Factor

Calculation Steps:

Error

Formula & Information

Unlevered Beta Formula:

βU = βL / [1 + (1 - Tax Rate) × (Debt/Equity)]

Where βU is unlevered beta, βL is levered beta, and (1 - Tax Rate) represents the tax shield effect.

What is Unlevered Beta?

  • • Measures systematic risk without financial leverage
  • • Represents pure business risk
  • • Used for comparable company analysis
  • • Essential for WACC calculations
  • • Also called "asset beta"

Key Applications:

  • • Valuation analysis
  • • Cost of equity calculations
  • • Risk assessment
  • • Portfolio management
  • • Capital structure optimization

Interpretation Guide:

Unlevered Beta Risk Level Interpretation
< 0 Negative Risk Moves opposite to market
0 - 0.5 Low Risk Less volatile than market
0.5 - 1.0 Moderate Risk Moderate market sensitivity
> 1.0 High Risk More volatile than market

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