| name | dcf-valuation |
| description | Portable discounted-cash-flow workflow for public companies. Use when asked for intrinsic value, fair value, price target support, undervalued/overvalued analysis, or a DCF sensitivity table. |
DCF Valuation Skill
This is a generic public-company DCF workflow. It is adapted as original guidance
for this harness and does not copy or require Dexter's runtime tools.
Checklist
- Gather five years of operating cash flow, capital expenditures, revenue,
margins, debt, cash, shares, market cap, enterprise value, and current price.
- Derive free cash flow when needed: operating cash flow minus capital
expenditures.
- Select a forecast growth rate from historical FCF/revenue trends, current
guidance, and business quality; haircut unusually high growth.
- Estimate a discount rate from sector risk, leverage, rates, and company-specific
risk. Explain the assumption rather than pretending precision.
- Project five years of FCF, fade growth toward a mature rate, and calculate a
terminal value with a conservative perpetual growth rate.
- Discount projected FCF and terminal value, subtract net debt, divide by diluted
shares, and compare to current price.
- Run a small sensitivity grid around WACC and terminal growth.
- Validate the result against market EV, FCF yield, and terminal-value share of
total value. Revise or caveat if sanity checks fail.
Output
Return a compact valuation summary, assumptions table, FCF projection, sensitivity
matrix, and caveats. State that a DCF is an estimate sensitive to assumptions.
