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Tool

DCF calculator

Calculate fair value using Discounted Cash Flow. Adjust cash flow, growth rate, terminal value and discount rate to understand how each assumption affects the valuation.

Guide

How to interpret the result

DCF gives a fair value estimate based on your assumptions. The result is sensitive to the discount rate and the long-term growth rate. Try changing these to see how much the value moves.

Terminal value dominates
In most DCF models, the terminal value accounts for 60 to 80 per cent of total value. The bar chart shows exactly how the split looks with your assumptions.
The discount rate is critical
A one percentage point difference in the discount rate can change the fair value estimate by 20 to 30 per cent. It is the variable with the greatest effect.
Assumptions matter more than the formula
The value of DCF is not a precise answer - it forces you to articulate your assumptions. Are they reasonable? That is the question.

Learn more

What is DCF?

Read our explanation of DCF in the glossary: what it measures, how the terminal value works, and why assumptions matter more than the formula.

DCF in the glossary

Common questions about DCF

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