Basic Formula For Firm Valuation Using DCF Model
value of firm =
where
- FCFF is the Free Cash Flow to the Firm (i.e. Operating cash flow minus capital expenditures)
- WACC is the Weighted Average Cost of Capital
- t is the time period
- n is the number of time periods
- g is the growth rate
- value of firm is enterprise value
Read more about this topic: Valuation Using Discounted Cash Flows
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