DCF Calculator

Calculate enterprise value using Discounted Cash Flow (DCF) analysis. Includes 5-year and 10-year DCF, Gordon Growth terminal value, equity value, intrinsic value per share, and WACC sensitivity analysis.

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Enterprise Value
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PV of Free Cash Flows (5yr) —
PV of Terminal Value —
Terminal Value % of EV —
Extended More scenarios, charts & detailed breakdown ▾
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Enterprise Value
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PV High-Growth Phase (Yrs 1-5) —
PV Declining Phase (Yrs 6-10) —
PV Terminal Value —
Professional Full parameters & maximum detail ▾
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Valuation

Enterprise Value —
Equity Value —
Intrinsic Value Per Share —

Terminal Value

Terminal Value (Gordon Growth) —
Terminal Value % of EV —

How to Use This Calculator

  1. Enter 5 years of projected Free Cash Flows (use after-tax unlevered FCF = EBIT×(1−T) + D&A − CapEx − ΔNWC).
  2. Set Terminal Growth Rate (recommend 2–3%, must be less than WACC).
  3. Set WACC — use our WACC Calculator or input directly.
  4. The calculator shows PV of FCFs, PV of Terminal Value, and Enterprise Value.
  5. Use the Sensitivity Analysis tab to see EV at WACC ±2%.
  6. Open Professional to subtract net debt and get intrinsic value per share.

Formula

Enterprise Value = Σ FCFt/(1+WACC)^t + Terminal Value/(1+WACC)^n

Terminal Value (Gordon Growth) = FCF_n × (1+g) / (WACC − g)

Example

Example: FCFs growing 10%/yr from $10M. Terminal growth 2.5%, WACC 9.83%. PV of FCFs = $45.8M. TV = FCF5×1.025/(0.0983−0.025) = $204.5M. PV of TV = $127.2M. Enterprise Value = $173M. TV = 73% of EV.

Frequently Asked Questions

  • Discounted Cash Flow (DCF) analysis values a business or investment by discounting projected future free cash flows back to present value using the WACC (discount rate). Enterprise Value = PV of FCFs + PV of Terminal Value. The terminal value captures all value beyond the forecast period.
  • Terminal value represents the present value of all cash flows beyond the forecast period, typically using the Gordon Growth Model: TV = FCF_last × (1+g) / (WACC − g). Terminal value often represents 60–80% of total DCF value, making the terminal growth rate assumption extremely sensitive.
  • The terminal growth rate should not exceed long-run GDP growth (2–3% for mature economies). Using a rate near WACC produces unrealistically high valuations. Most practitioners use 2–3% for stable businesses. The terminal growth rate must always be less than the discount rate.
  • Equity Value = Enterprise Value − Net Debt (total interest-bearing debt minus cash & equivalents). Then intrinsic value per share = Equity Value / Diluted shares outstanding. Include all dilutive securities: options, warrants, convertibles.
  • WACC depends on the company's capital structure and risk profile. Calculate WACC using our WACC Calculator with CAPM-derived cost of equity. Typical ranges: tech/growth companies 10–14%, mature industrials 7–9%, utilities 5–7%. Always run a sensitivity table at WACC ±2%.

Related Calculators

⚖️ WACC Calculator 📊 NPV Calculator 🏢 Enterprise Value Calculator 📈 CAPM Calculator
Sources & References (5) ▾
  1. Investment Valuation — Aswath Damodaran — NYU Stern / Wiley Finance
  2. Valuation: Measuring and Managing the Value of Companies — McKinsey — McKinsey & Company / Wiley
  3. CFA Institute — Free Cash Flow Valuation — CFA Institute
  4. Principles of Corporate Finance — Brealey, Myers & Allen — McGraw-Hill
  5. DCF Valuation Explained — Investopedia — Investopedia