Discounted Cash Flow Valuation

DCF values a business on the cash it can return to owners. This DCF calculator projects free cash flow forward at your growth rate, discounts each year back at the WACC, adds a Gordon-growth terminal value, and divides by shares outstanding to estimate intrinsic value per share.

The Model

Intrinsic Value = Σ FCFₜ/(1+r)ᵗ + [FCFₙ(1+g)/(r−g)]/(1+r)ⁿ. The terminal value dominates — often 60–80% of the total — so scrutinize the terminal growth assumption. If terminal growth approaches WACC, the model explodes; keep g well below r.

Interpreting the Result

Compare intrinsic value per share to the current market price. If intrinsic exceeds price, the stock may be undervalued — but only under your assumptions. Re-run with pessimistic, base, and optimistic inputs; a stock that is cheap in every scenario is a far stronger signal than one cheap in just one.