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reverse-dcf

Solves for the growth or margin the current price already assumes, instead of guessing a path and producing a price. It turns "is it cheap" into "is that assumption reasonable".

ValuationStage 4 Ten minutes.

This one is in the paid set. Enter your code below and the download turns on.

Reach for it when

  • Before variant-perception, always
  • Someone asked whether a stock is expensive
  • You want to argue with the market rather than with yourself
Needs first
Enterprise value, revenue, unlevered free cash flow, a discount rate.
Leaves behind
The implied path in plain English, compared to the company's own history and to consensus, with the discount rate sensitivity shown.
Takes about
Ten minutes.
Will not
Give a verdict on the price. It reports what the price assumes and leaves the judgement to you.

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