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This is a simple Discounted Cash Flow (DCF) model taken from chapter 10 of Pat Dorsey's book "The Five Rules fo
I highly recommend reading it to get the most out of this worksheet.
You can find it here on Amazon or check your local library system for a copy.
DISCLAIMER: This is intended as an educational tool at most. Please don't think you've found the Rosetta Stone o
rsey's book "The Five Rules for Successful Investing."
've found the Rosetta Stone of investing and go lose a bunch of money.
Enter Your Stock's Info
(In Green Cells Only)
Stock COST
Date 2015.10.15
Current Stock Price $ 151.77
Shares outstanding (mil) 442
Next year's free cash flow (mil) $ 1,943
Perpetuity growth rate (g) 3%
Discount Rate ( r ) 10.5%
10 year Growth Rate 7.0%
Margin of Safety 20%
Year 1 2 3 4
Free Cash Flow (mil) $ 1,943 $ 2,079 $ 2,225 $ 2,380
÷ Discount Factor 110.5% 122.1% 134.9% 149.1%
= Discounted FCF (mil) $ 1,758 $ 1,703 $ 1,649 $ 1,597
ed (Overvalued) by: