dcf-valuation

name	dcf-valuation
description	Estimate a public equity's intrinsic value with a discounted-cash-flow model — pull fundamentals, set a discount rate via CAPM/WACC, project free cash flow, and discount it.
tags	["equity","valuation","dcf","intrinsic-value"]
requires_tools	["data_equity_reference","data_equity_fundamentals","compute_valuation_wacc","compute_valuation_dcf"]

DCF valuation

Estimate intrinsic value per share with a transparent, grounded DCF.

Workflow

1. Anchor the company. data_equity_reference for shares outstanding, beta, and current price; data_equity_fundamentals for revenue, free cash flow, margins, growth, and total cash/debt.
2. Discount rate. compute_valuation_wacc — CAPM cost of equity from a risk-free rate, an equity risk premium, and the beta you pulled; add the debt trio for a WACC blend when leverage is material. Use the resulting rate.
3. Project FCF. Build a short explicit free-cash-flow schedule (typically 3–5 years) from the latest FCF and a growth path grounded in the fundamentals and trend. State the assumptions you used.
4. Value it. compute_valuation_dcf with the FCF schedule, the discount rate, a terminal method (Gordon growth or exit multiple), net debt (debt − cash), and shares outstanding. Chain bulk inputs with prev: references where a prior tool already produced the series.
5. Report. Intrinsic value per share vs. the current price, the discount rate and key assumptions, and how much of the value rests on the terminal value.

Principles

• Make every assumption explicit (growth, discount rate, terminal method) — a DCF is only as credible as its inputs, and the reader needs to see them.
• Prefer chaining real figures (fundamentals → FCF → DCF) over restating numbers by hand; let the tools carry the arithmetic.
• A high terminal-value share of enterprise value is worth flagging, not hiding — report the number and let the reader weigh it.