Dcf Valuation Excel

The problem

Building a discounted cash flow model from scratch is prone to hardcoding errors and circular references. Manually bridging EBIT to Free Cash Flow while managing WACC sensitivities across multiple sheets is tedious and easy to break.

What it does

• Generates a multi-sheet Excel architecture including Assumptions, Projections, FCF, WACC, and Valuation.
• Builds a complete FCF bridge calculating NOPAT, D&A, Capex, and Net Working Capital changes.
• Calculates WACC using CAPM for equity and tax-shielded cost of debt based on target capital structures.
• Computes Enterprise Value and Equity Value per share using Gordon Growth for terminal value.
• Automates a two-variable sensitivity table for WACC and terminal growth rates.

Frameworks & tools

Microsoft Excel, VBA/Macros, Financial Modeling best practices.

Why this beats prompting it yourself

Generic prompts often result in flat lists or simplified math that ignores NOPAT and NWC adjustments. This skill enforces institutional-grade linking, ensuring every projection cell traces back to a central Assumptions sheet without hardcoded values in the logic.

Use cases

• Preparing valuation models for M&A support or investment memos.
• Stress-testing a company purchase price against varying WACC assumptions.
• Internal budgeting and long-term financial planning against valuation targets.
• Generating sensitivity matrices for equity research reports.

Known limitations

Not suitable for early-stage startups without revenue history or highly cyclical businesses with unpredictable cash flows. Requires manual entry of historical revenue and debt figures.