Dcf Valuation

by claude-office-skills9c4c7d5cd281MIT499 starsListed Oct 8, 2026Updated Oct 8, 2026Repository updated 8 months ago

Build Discounted Cash Flow (DCF) valuation models. Calculate intrinsic value with customizable assumptions. Generate professional valuation reports.

Instructions onlyBusiness & Finance

AI-generated overview

Builds Discounted Cash Flow valuation models with WACC, terminal value and sensitivity analysis, producing a structured valuation report.

What it does: Guides the user through supplying historical financials and assumptions, then lays out a DCF framework covering unlevered free cash flow, WACC via CAPM, terminal value by Gordon Growth or exit multiple, and discounting to equity value per share. It defines a fixed markdown report format with executive summary, assumptions, cash flow projections, valuation summary, sensitivity tables and risks. It also states limitations, including that it cannot guarantee projection accuracy or give investment recommendations.
When to use it: Use it when estimating the intrinsic value of a company from financial data and stated assumptions, or when a structured DCF write-up is needed for analysis or educational purposes. It is not intended for early-stage unprofitable companies or as a substitute for professional due diligence.
Requirements: Instructions only, with no bundled scripts. The front matter lists an office-mcp server with read_xlsx, create_xlsx, apply_formula and create_chart tools, so spreadsheet access is expected for data input and output. Users must supply historical financials, shares outstanding and assumptions; a current stock price is optional.

DCF Valuation Skill

Overview

I help you build Discounted Cash Flow (DCF) models to estimate the intrinsic value of companies. DCF is the gold standard for fundamental valuation used by investment banks, hedge funds, and professional investors.

What I can do:

Build complete DCF models from financial data
Calculate WACC (Weighted Average Cost of Capital)
Project future free cash flows
Estimate terminal value (Gordon Growth or Exit Multiple)
Run sensitivity analysis on key assumptions
Generate professional valuation summaries

What I cannot do:

Guarantee accuracy of projections
Account for unpredictable future events
Provide investment recommendations
Replace professional financial due diligence

How to Use Me

Step 1: Provide Financial Data

I need:

Historical financials (3-5 years of revenue, EBITDA, capex, D&A)
Current shares outstanding
Current stock price (optional, for comparison)
Industry/sector context

Step 2: Set Assumptions

Key assumptions to specify (or I'll use industry defaults):

Revenue growth rates (Year 1-5)
EBITDA margin trajectory
Capex as % of revenue
Working capital changes
Terminal growth rate
Discount rate (WACC)

Step 3: Choose Model Type

Standard DCF: 5-year projection + terminal value
Two-Stage DCF: High growth + stable growth phases
Three-Stage DCF: Growth, transition, maturity phases

DCF Model Framework

Step 1: Project Free Cash Flow (FCF)

Unlevered Free Cash Flow (UFCF) =    EBIT × (1 - Tax Rate)  + Depreciation & Amortization  - Capital Expenditures  - Change in Net Working Capital

Unlevered Free Cash Flow (UFCF) =    EBIT × (1 - Tax Rate)  + Depreciation & Amortization  - Capital Expenditures  - Change in Net Working Capital

Step 2: Calculate WACC

WACC = (E/V × Re) + (D/V × Rd × (1 - Tc))
Where:E = Market value of equityD = Market value of debtV = E + D (total value)Re = Cost of equity (CAPM: Rf + β × Market Risk Premium)Rd = Cost of debtTc = Corporate tax rate

WACC = (E/V × Re) + (D/V × Rd × (1 - Tc))
Where:E = Market value of equityD = Market value of debtV = E + D (total value)Re = Cost of equity (CAPM: Rf + β × Market Risk Premium)Rd = Cost of debtTc = Corporate tax rate

CAPM Formula for Cost of Equity

Re = Rf + β × (Rm - Rf)
Where:Rf = Risk-free rate (10-year Treasury)β = Stock beta (systematic risk)Rm - Rf = Equity risk premium (typically 5-6%)

Re = Rf + β × (Rm - Rf)
Where:Rf = Risk-free rate (10-year Treasury)β = Stock beta (systematic risk)Rm - Rf = Equity risk premium (typically 5-6%)

Step 3: Calculate Terminal Value

Method A: Gordon Growth Model

Terminal Value = FCF(n+1) / (WACC - g)
Where:FCF(n+1) = Final year FCF × (1 + g)g = Terminal growth rate (typically 2-3%, ≤ GDP growth)

Terminal Value = FCF(n+1) / (WACC - g)
Where:FCF(n+1) = Final year FCF × (1 + g)g = Terminal growth rate (typically 2-3%, ≤ GDP growth)

Method B: Exit Multiple

Terminal Value = EBITDA(n) × Exit Multiple
Common multiples by sector:- Technology: 10-15x- Healthcare: 8-12x- Consumer: 6-10x- Industrial: 5-8x

Terminal Value = EBITDA(n) × Exit Multiple
Common multiples by sector:- Technology: 10-15x- Healthcare: 8-12x- Consumer: 6-10x- Industrial: 5-8x

Step 4: Discount to Present Value

Enterprise Value = Σ [FCF(t) / (1 + WACC)^t] + [TV / (1 + WACC)^n]
Equity Value = Enterprise Value - Net Debt + Cash
Intrinsic Value per Share = Equity Value / Shares Outstanding

Enterprise Value = Σ [FCF(t) / (1 + WACC)^t] + [TV / (1 + WACC)^n]
Equity Value = Enterprise Value - Net Debt + Cash
Intrinsic Value per Share = Equity Value / Shares Outstanding

Output Format

markdown

# DCF Valuation Model: [Company Name]
**Valuation Date**: [Date]**Analyst**: AI-Generated**Model Type**: [Standard/Two-Stage/Three-Stage]
---
## Executive Summary
| Metric | Value ||--------|-------|| **Intrinsic Value per Share** | $XX.XX || **Current Market Price** | $XX.XX || **Upside/Downside** | +/-XX% || **Implied Recommendation** | [Undervalued/Fair/Overvalued] |
---
## Key Assumptions
### Revenue Projections| Year | Revenue ($M) | Growth % ||------|-------------|----------|| Base (Current) | X,XXX | - || Year 1 | X,XXX | XX% || Year 2 | X,XXX | XX% || Year 3 | X,XXX | XX% || Year 4 | X,XXX | XX% || Year 5 | X,XXX | XX% |
### Margin Assumptions| Metric | Year 1 | Year 5 | Rationale ||--------|--------|--------|-----------|| EBITDA Margin | XX% | XX% | [Reason] || Capex/Revenue | XX% | XX% | [Reason] || D&A/Revenue | XX% | XX% | [Reason] |
### WACC Calculation| Component | Value | Source/Assumption ||-----------|-------|-------------------|| Risk-free Rate | X.X% | 10-Year Treasury || Beta | X.XX | Bloomberg/Calculated || Equity Risk Premium | X.X% | Historical average || Cost of Equity | XX.X% | CAPM || Cost of Debt | X.X% | Credit spread || Tax Rate | XX% | Effective rate || Debt/Total Capital | XX% | Current structure || **WACC** | **X.X%** | |
### Terminal Value| Method | Value ($M) | As % of EV ||--------|-----------|------------|| Gordon Growth (g=X%) | X,XXX | XX% || Exit Multiple (Xx EBITDA) | X,XXX | XX% || **Selected** | **X,XXX** | **XX%** |
---
## Free Cash Flow Projections
| ($M) | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Terminal ||------|--------|--------|--------|--------|--------|----------|| Revenue | | | | | | || EBITDA | | | | | | || (-) D&A | | | | | | || EBIT | | | | | | || (-) Taxes | | | | | | || NOPAT | | | | | | || (+) D&A | | | | | | || (-) Capex | | | | | | || (-) ΔNWC | | | | | | || **UFCF** | | | | | | |
---
## Valuation Summary
| Component | Value ($M) ||-----------|-----------|| PV of Projected FCFs | X,XXX || PV of Terminal Value | X,XXX || **Enterprise Value** | **X,XXX** || (-) Net Debt | (X,XXX) || (+) Cash | X,XXX || **Equity Value** | **X,XXX** || Shares Outstanding | XXX M || **Value per Share** | **$XX.XX** |
---
## Sensitivity Analysis
### WACC vs Terminal Growth Rate
| WACC ↓ / g → | 1.5% | 2.0% | 2.5% | 3.0% ||--------------|------|------|------|------|| 8.0% | $XX | $XX | $XX | $XX || 8.5% | $XX | $XX | $XX | $XX || 9.0% | $XX | $XX | **$XX** | $XX || 9.5% | $XX | $XX | $XX | $XX || 10.0% | $XX | $XX | $XX | $XX |
### Key Drivers Impact
| Assumption Change | Impact on Value ||-------------------|-----------------|| WACC +1% | -XX% || Terminal Growth +0.5% | +XX% || Revenue CAGR +2% | +XX% || EBITDA Margin +2% | +XX% |
---
## Risks to Valuation
1. **Model Risk**: DCF highly sensitive to WACC and terminal growth assumptions2. **Execution Risk**: Projected growth may not materialize3. **Market Risk**: Multiple compression in downturn4. **[Company-Specific Risk]**: [Detail]
---
## Disclaimer
This valuation model is for educational and informational purposes only. It does not constitute investment advice. The intrinsic value estimate is based on assumptions that may not reflect reality.

# DCF Valuation Model: [Company Name]
**Valuation Date**: [Date]**Analyst**: AI-Generated**Model Type**: [Standard/Two-Stage/Three-Stage]
---
## Executive Summary
| Metric | Value ||--------|-------|| **Intrinsic Value per Share** | $XX.XX || **Current Market Price** | $XX.XX || **Upside/Downside** | +/-XX% || **Implied Recommendation** | [Undervalued/Fair/Overvalued] |
---
## Key Assumptions
### Revenue Projections| Year | Revenue ($M) | Growth % ||------|-------------|----------|| Base (Current) | X,XXX | - || Year 1 | X,XXX | XX% || Year 2 | X,XXX | XX% || Year 3 | X,XXX | XX% || Year 4 | X,XXX | XX% || Year 5 | X,XXX | XX% |
### Margin Assumptions| Metric | Year 1 | Year 5 | Rationale ||--------|--------|--------|-----------|| EBITDA Margin | XX% | XX% | [Reason] || Capex/Revenue | XX% | XX% | [Reason] || D&A/Revenue | XX% | XX% | [Reason] |
### WACC Calculation| Component | Value | Source/Assumption ||-----------|-------|-------------------|| Risk-free Rate | X.X% | 10-Year Treasury || Beta | X.XX | Bloomberg/Calculated || Equity Risk Premium | X.X% | Historical average || Cost of Equity | XX.X% | CAPM || Cost of Debt | X.X% | Credit spread || Tax Rate | XX% | Effective rate || Debt/Total Capital | XX% | Current structure || **WACC** | **X.X%** | |
### Terminal Value| Method | Value ($M) | As % of EV ||--------|-----------|------------|| Gordon Growth (g=X%) | X,XXX | XX% || Exit Multiple (Xx EBITDA) | X,XXX | XX% || **Selected** | **X,XXX** | **XX%** |
---
## Free Cash Flow Projections
| ($M) | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Terminal ||------|--------|--------|--------|--------|--------|----------|| Revenue | | | | | | || EBITDA | | | | | | || (-) D&A | | | | | | || EBIT | | | | | | || (-) Taxes | | | | | | || NOPAT | | | | | | || (+) D&A | | | | | | || (-) Capex | | | | | | || (-) ΔNWC | | | | | | || **UFCF** | | | | | | |
---
## Valuation Summary
| Component | Value ($M) ||-----------|-----------|| PV of Projected FCFs | X,XXX || PV of Terminal Value | X,XXX || **Enterprise Value** | **X,XXX** || (-) Net Debt | (X,XXX) || (+) Cash | X,XXX || **Equity Value** | **X,XXX** || Shares Outstanding | XXX M || **Value per Share** | **$XX.XX** |
---
## Sensitivity Analysis
### WACC vs Terminal Growth Rate
| WACC ↓ / g → | 1.5% | 2.0% | 2.5% | 3.0% ||--------------|------|------|------|------|| 8.0% | $XX | $XX | $XX | $XX || 8.5% | $XX | $XX | $XX | $XX || 9.0% | $XX | $XX | **$XX** | $XX || 9.5% | $XX | $XX | $XX | $XX || 10.0% | $XX | $XX | $XX | $XX |
### Key Drivers Impact
| Assumption Change | Impact on Value ||-------------------|-----------------|| WACC +1% | -XX% || Terminal Growth +0.5% | +XX% || Revenue CAGR +2% | +XX% || EBITDA Margin +2% | +XX% |
---
## Risks to Valuation
1. **Model Risk**: DCF highly sensitive to WACC and terminal growth assumptions2. **Execution Risk**: Projected growth may not materialize3. **Market Risk**: Multiple compression in downturn4. **[Company-Specific Risk]**: [Detail]
---
## Disclaimer
This valuation model is for educational and informational purposes only. It does not constitute investment advice. The intrinsic value estimate is based on assumptions that may not reflect reality.

Example

User Request

Build a DCF model for a SaaS company with:- Current revenue: $500M- Revenue growth: 25% declining to 15% over 5 years- EBITDA margin: 20% improving to 30%- Current stock price: $45- Shares outstanding: 100M

Build a DCF model for a SaaS company with:- Current revenue: $500M- Revenue growth: 25% declining to 15% over 5 years- EBITDA margin: 20% improving to 30%- Current stock price: $45- Shares outstanding: 100M

My Response

[Complete DCF model with all calculations...]

Tips for Better Results

Provide historical data for more accurate projections
Be explicit about growth assumptions rather than using defaults
Specify the industry for appropriate comparables
Request sensitivity analysis to understand valuation range
Cross-check with multiples (P/E, EV/EBITDA) for sanity check

Limitations

Garbage in, garbage out - results depend on assumption quality
Terminal value often represents 60-80% of total value
Does not account for optionality or real options value
Assumes constant WACC throughout projection period
Not suitable for early-stage unprofitable companies

Built by the Claude Office Skills community. Contributions welcome!

Source and attribution

Source:claude-office-skills/skillsindcf-valuationat commit9c4c7d5

License: MIT

Content belongs to its original authors. SourceWeft indexes it from a public repository.

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Dcf Valuation

DCF Valuation Skill

Overview

How to Use Me

Step 1: Provide Financial Data

Step 2: Set Assumptions

Step 3: Choose Model Type

DCF Model Framework

Step 1: Project Free Cash Flow (FCF)

Step 2: Calculate WACC

CAPM Formula for Cost of Equity

Step 3: Calculate Terminal Value

Method A: Gordon Growth Model

Method B: Exit Multiple

Step 4: Discount to Present Value

Output Format

Example

User Request

My Response

Tips for Better Results

Limitations

Source and attribution

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