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Concept12 min read
Discounted Cash Flow (DCF) Valuation
DCF values a business as the present value of its future free cash flows, discounted at a rate that reflects their risk. It is the most theoretically rigorous valuation method and the backbone of corporate finance.
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What's inside
- Definition
- Why it matters
- Formula
- Units & benchmarks
- Key levers
- Where it shows up in cases
- How it's charted
- Worked example
- Common traps
- Industry nuances
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