DCF Valuation Calculator - Young Investor Calculator

Calculate DCF Valuation

Enter projected cash flows, discount rate, and terminal growth rate to estimate the intrinsic value of an investment. All monetary values should be in Ghanaian Cedi (GHS). Example: Use FCFE data from Access Bank Ghana (174 million shares).

DCF Formula

DCF = Σ (Cash Flowₜ / (1 + Discount Rate)ᵗ) + Terminal Value / (1 + Discount Rate)ⁿ

Where Terminal Value = (Final Year Cash Flow × (1 + Terminal Growth Rate)) / (Discount Rate - Terminal Growth Rate).

Forecast Period (Years)

Discount Rate (%)

Terminal Growth Rate (%)

DCF Valuation Results

Intrinsic Value

GHS 0.00

Interpretation:

Year	Cash Flow (GHS)	Present Value (GHS)
Terminal Value
Total

Use the total DCF value to assess the intrinsic value of the investment. Divide by shares outstanding (e.g., 174 million for Access Bank Ghana) to get intrinsic value per share.

Understanding DCF Valuation

Discounted Cash Flow (DCF) valuation estimates the intrinsic value of an investment by discounting projected future cash flows to their present value. It’s widely used for valuing companies or portfolios.

Intrinsic Value

Assess True Worth

DCF calculates the present value of future cash flows, reflecting the investment’s true value.

Accurate Inputs

Critical for Results

Use reliable cash flow projections and appropriate discount and growth rates.

How to Use the DCF Calculator

Select Forecast Period
Choose the number of years (1-10) for cash flow projections.
Enter Cash Flows
Input projected cash flows (e.g., FCFE) for each year, sourced from financial statements or estimates.
Enter Discount Rate
Provide the discount rate (e.g., WACC or required return, typically 5-10%).
Enter Terminal Growth Rate
Input the perpetual growth rate for cash flows after the forecast period (e.g., 1-3%).
Calculate and Review
Click “Calculate” to compute the DCF value. Use the result to assess intrinsic value or per-share value.

Key Applications of DCF

Valuing companies or investments based on future cash flows
Assessing intrinsic value for stock investments
Comparing investment opportunities
Estimating per-share value by dividing by shares outstanding

Download Guide Watch Tutorial

To calculate an accurate Discounted Cash Flow (DCF) valuation, source reliable financial data. Here’s how to find the required inputs for global and Ghanaian companies:

Cash Flows
Use Free Cash Flow to Equity (FCFE) or Free Cash Flow to the Firm (FCFF):
- FCFE: Calculate using the FCFE Calculator or source from cash flow statements (Yahoo Finance, gse.com.gh).
- FCFF: Find in cash flow statements under “Operating Cash Flow” minus capital expenditures.
- Projections: Use analyst estimates from Yahoo Finance “Analysis” tab or company guidance.
Discount Rate
Use the Weighted Average Cost of Capital (WACC) or required return:
- WACC: Calculate using cost of equity (CAPM) and cost of debt, or use estimates from financial websites.
- Sources: Yahoo Finance, Bloomberg, or company annual reports.
Terminal Growth Rate
Estimate perpetual growth rate:
- Typically 1-3%, based on long-term GDP growth or industry growth rates.
- Sources: IMF/World Bank for Ghana GDP growth, or analyst reports.
Tips
- Verify data from multiple sources (e.g., Yahoo Finance, gse.com.gh, annualreportsghana.com).
- For Ghanaian companies, check gse.com.gh for financial statements and announcements.
- Ensure discount rate exceeds terminal growth rate for valid terminal value.

Examples:

Access Bank Ghana (ABG): FCFE = GHS 217.5M (Year 1), Discount Rate = 8%, Terminal Growth = 2% (from gse.com.gh).
JPMorgan Chase (JPM): FCFF = $40B, Discount Rate = 7%, Terminal Growth = 2.5% (from Yahoo Finance).

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