Discount Cash Flow Calculator

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Discounted Cash Flow Calculator (DCF)

8.)Discount Cash Flow Calculator

                   The Discount Cash Flow is short term DCF.DCF to the Net present value in discount rate(%).Two value follow the DCF calculation for terminal value and Growth value.The total value consider to intrinsic value. Intrinsic value is equal to growth value added to terminal value.

Formula for as

          Intrinsic value =Growth value +terminal value

Intrinsic value- The Intrinsic value is lower or higher investment will never payoff.

Growth value –The growth value is company’s value will increase during the growth stage.

Terminal value –The other value part of the intrinsic value called the terminal value.

Example for

          Intrinsic value=$75.24+$74.1

The answers is $149.34

9.)GROWTH VALUE CALCULATION

          The Growth Value is equal to EPS  Multiple A Value Multiple is number of 1 less than A  and multiple numbers of years  divided  1number less than A value.

Formula as,

          Growth value =EPS*A*(1-A*n)/(1-A)

EPS-The earnings per share

A-Co-efficient equal to A=(1+G)/(1+R)

G-Is the growth rate

R-Is the discount rate  equal to Weighted average cost of capita

N-Is  the numbers of years

Example for ,

          A Value is =(1+G)/(1+R)

          =(1+0.05)/(1+0.09)

The answer is 1.14

Growth Value=EPS*A*(1-A*N)/(1-A)

                   =$70*1.14*(1-1.14*3)/(1-1.14)

                   The answer is $75.24

Terminal Value

          Terminal value equal to EPS multiple  A is coefficient  number of year in B value. In multible to 1number less than B value multiple I is the number of year in terminal Growth divided to 1 number less than B value.

Formula as

Terminal value-EPS*A*n*B*(1-B*i)/(1-B)

          EPS-EPS are the earnings per share

          A is a coefficient equal to A=(1+G)/(1+R)

          G-The growth rate

          R-The discount rate(equal to wacc)

          N-number of years

          B is a coefficient equal toB=(1+T)/(1+R)

          T-The terminal growth rate

          I-The number of year in terminal growth

B Value is =(1+T)/(1+R)

                   =(1+0.05)/(1+0.12)

The answer is 1.17

Terminal value =EPS*A*(1-A*n)/(1-A)

                             $70*1.14*(1-1.14*4)/(1-1.14)

The answer is $74.1

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