Which of the following is not one of the steps in using discounted cash flow to value a company?
A) Estimate the amount and timing of the future stream of cash flows
B) Estimate an appropriate discount rate
C) Use a present value model to calculate an intrinsic value
D) Compare the intrinsic value to the relative value metric

Question

Quizplus · Accepted Answer

Discounted cash flow (DCF) involves estimating future cash flows, determining an appropriate discount rate, and calculating the present value to find intrinsic value. Comparing intrinsic value to a relative value metric is not a step in DCF; it involves comparing to market or industry benchmarks.

Which of the Following Is Not One of the Steps