DCF Valuation Calculator — Enterprise Value
A DCF (Discounted Cash Flow) valuation computes enterprise value as the present value of projected free cash flows plus a terminal value. Enter your current free cash flow, growth rate, WACC and terminal growth below — the calculator projects 5 years and applies the Gordon-Growth formula.
EV = Σ FCFt ÷ (1+WACC)^t + [FCF₅ × (1+g) ÷ (WACC − g)] ÷ (1+WACC)^5
Worked example (default inputs)
| Current annual free cash flow ($) | 200000 |
| FCF growth rate (%/yr) | 15 |
| WACC (%) | 12 |
| Terminal growth (%) | 3 |
| PV of 5-year cash flows | $1,083,285 |
| Terminal value (undiscounted) | $4,603,773 |
| PV of terminal value | $2,612,305 |
| Enterprise value | $3,695,590 |
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Frequently asked questions
Why must WACC exceed terminal growth?
The Gordon-Growth formula divides by (WACC − g); if growth matched or exceeded the discount rate, value would be infinite. Terminal growth should approximate long-run GDP/inflation, typically 2–3%.
What share of value should the terminal value be?
Often 50–75% of enterprise value for a 5-year forecast. If it is much higher, extend the explicit forecast — EasyFinancialModels supports up to 25-year horizons.
Is enterprise value the same as equity value?
No. Equity value = enterprise value − net debt (debt minus cash). The generated Excel model computes both.
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