DCF and Graham formula

With DCF and Graham formulas It is possible to calculate the company's current and historical values. 
The formulas try to give a reasonable measure of what the company should be valued depending on the company's current profit, growth rate and return Requirements. 

cdf värdering


You can see the Company's current and historical valuation together with the share price trend over Time. 
This makes it possible to compare the company's valuation in relation to the market Value.dcf




DCF - Discounted cash flow

DCF is the most widely used valuation model in the financial industry. It is about discounting future cash flows to a value today. Three important parts that you have to adjust after each company.

1-growth for all companies is 10% by default for all listed Companies. It is important that annual growth is adjusted to a more reasonable growth rate for the current company. Annual growth is calculated up to 10 years and after that it is the terminal growth takes over. Carefully using high growth values.

2-the discount rate is the same as the return requirement of the Investment. Lower yield requirements generate higher valuations and equally so a higher yield requirement results in a lower Valuation. Do not change if you are not sure what is a reasonable return requirement.

3-the latest rolling profit must also be adjusted if it does not reflect a fair profit level on the Company. There are many reasons why the reported profit shows unreasonable levels such as accounting effects on write-downs or revaluations or temporary non-recurring items that affect profits significantly. 

dcf viktiga inställningar



Graham Formula

Graham's Formula brings out company valuation based on the Company's growth and latest profit. The model values a company that does not grow to 8.5 profit Multiple. 

1-profit growth (g) is 8% by default for all listed Companies. It is important that earnings growth be adjusted to a more reasonable growth rate for the current company. Be cautious about using high growth values. Graham's Valuation model does not fit well for companies that grow more than 10-12% per year. 

2-the last rolling profit must also be adjusted if it does not show the fair profit level of the Company. There are many reasons why the reported profit shows unreasonable levels such as accounting effects or temporary non-recurring items that affect profits significantly.  

graham värdering