Cash Flow 1 =

Cash Flow 2 = 0

Cash Flow 3 = 0

Cash Flow 4 = 0

Cash Flow 5 = 0

Cash Flow 6 = 0

Cash Flow 7 = 0

Cash Flow 8 = 0

Cash Flow 9 = 0

Cash Flow 10 = 0

Discount Rate =

DCF =

This is a model for a 10 year discounted cash flow. Usually these are calculated to year "n." CF represents a free cash flow from the specified year. The discount rate is usually the WACC or sometimes the CAPM.

A discounted cash flow uses future free cash flow projections and discounts them using the weighted average cost of capital (WACC) or CAPM to arrive at a present value. If the DCF analysis yields a higher value than the current cost of the investment the opportunity may be a good one.

Contributed by Ian Snyder

Cash Flow 1

Cash Flow 2

Cash Flow 3

Cash Flow 4

Cash Flow 5

Cash Flow 6

Cash Flow 7

Cash Flow 8

Cash Flow 9

Cash Flow 10

Discount Rate

DCF

-------------