Step-by-Step DCF Valuation! from Udemy

The Step-by-Step DCF Valuation course is designed to provide you with a highly understandable & time-efficient way to learn more about the most popular company valuation tool within finance.

We cover each step of a DCF valuation analysis from collating forecast company financials to creating outputs, and even doing some sensitivity analysis. We use a highly practical learning approach, so that you can reinforce your learning by doing a real company valuation step-by-step during this course. We stand by your side each step of the way as you discover the need-to-know concepts to make sure you can put this to use immediately. The 100% free preview lectures and course outline will give you a feel for the style and level of content that will be covered.

I have worked in senior roles at the best global investment banks such as J.P. Morgan and Citigroup, having also been a private equity investor in Europe and Asia. You should feel confident that you are in good hands.

Course Outline:

1. Core Principles of Valuation - discover the essentials of what you need to know about corporate finance and valuation

2. Company Financials - dive into how to find and interpret forecast financials for major listed stocks for free

3. The WACC - learn how the discount rate throughout a DCF valuation analysis

4. DCF Assumptions - understand how to create your own, defendable assumptions for a DCF valuation

5. Calculating the DCF Valuation - use practical exercises to understand how to model out a DCF valuation within Excel

6. Sensitivity Analysis - learn about how to run the most common sensitivities on your DCF model

7. Creating Outputs - discover how to create your own, industry-standard DCF outputs within PowerPoint

If you have any questions once you get started, do not hesitate to use the embedded Q&A function and we will get back to you shortly to continue your learning journey.

Whether you're brand new to the finance world or are wanting to just learn more about valuation and DCFs, this is the course for you.

We can't wait to see you inside the course.

What's inside

Learning objectives

Learn how to create a detailed dcf valuation model from start to finish
Understand how to formulate a set of valuation assumptions
Discover the resources available to determine a company's forecast financials

Understand how to calculate the wacc and each of its components
Learn how to create industry standard dcf sensitivities and outputs

Learn how to create a detailed dcf valuation model from start to finish
Understand how to formulate a set of valuation assumptions
Discover the resources available to determine a company's forecast financials
Understand how to calculate the wacc and each of its components
Learn how to create industry standard dcf sensitivities and outputs

Syllabus

Covers the course outline, instructor background and goals of the course.

Covers the core finance concepts of the time value of money and discount rates.

Covers the core finance concepts of free cash flow and net present value.

Covers the characteristics of companies that are suitable to be valued via a DCF model.

This quiz assesses the student's knowledge of the core principles of valuation covered in Section 1.

Covers how to find forecast company financials using MarketScreener.

Covers how to extract key P&L and cash flow items into Excel that will be required for the DCF model.

Covers the role of the WACC and how it is calculated.

Covers how to determine the applicable cost of debt and tax rate for a listed company.

Covers how to determine the target capital structure (debt / equity mix) for a listed company.

Covers how to use the CAPM to calculate the cost of equity.

Covers how to determine the valuation date for a DCF model and any applicable stub adjustments.

Covers how to determine the appropriate number of forecast years to include in a DCF model.

Covers the two main methods of how to calculate a terminal value within a DCF analysis.

Covers how to complete the free cash flow schedule within a DCF valuation analysis.

Covers how to complete the terminal value schedule within a DCF valuation analysis.

Covers how to calculate the company valuation implied by the DCF, and subsequently the implied share price.

Provides an overview of sensitivity analysis and why it is so widely used by the finance community.

Covers how to create sensitivities within a DCF model in Excel.

Covers how to create DCF outputs within PowerPoint.

A short thank you message from the course instructor.

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Read about what's good

what should give you pause

and possible dealbreakers

Uses a practical learning approach, allowing learners to reinforce their understanding by performing a real company valuation step-by-step, which is highly valuable for practical application

Covers each step of a DCF valuation analysis, from collating forecast company financials to creating outputs and sensitivity analysis, which is a comprehensive approach

Teaches how to create industry-standard DCF outputs within PowerPoint, which is a core skill for presenting financial analysis in a professional setting

Requires learners to use Excel and PowerPoint, which may require learners to purchase licenses if they do not already have access to these software programs

Explores how to find and interpret forecast financials for major listed stocks, which is essential for conducting real-world DCF valuations

Reviews summary

Practical step-by-step dcf valuation

According to learners, this course provides a highly practical step-by-step approach to DCF valuation using Excel. Many found the explanations clear and easy to follow, making it particularly useful for beginners looking to build a solid foundation. The hands-on Excel modeling exercises are highlighted as a major strength, providing direct, applicable skills. Students frequently mention the course's value for their finance careers, noting that the techniques taught are directly applicable to their jobs. While strong for fundamental understanding, some reviewers suggest it could delve deeper into more advanced or complex scenarios. Overall, it's seen as a well-structured and effective introduction to DCF valuation.

Provides a solid foundation.

"Perfect introduction if you're new to DCF valuation."

"As a beginner in finance, I found this course very accessible and a great starting point."

"Builds a solid foundation for understanding company valuation methods."

Directly applicable to finance roles.

"This valuation framework is exactly what I need and use in my job."

"Helped me confidently apply DCF concepts at work and improved my skills."

"Gave me the tools needed for financial analysis tasks right away."

"Very useful for anyone working or aspiring to work in finance or investment."

Concepts are easy to follow for beginners.

"The instructor explained complex concepts very clearly, making DCF accessible."

"This course broke down DCF valuation into understandable and manageable steps."

"Found the lectures easy to digest and well-structured, great for understanding the basics."

"The explanations were simple and direct, avoiding unnecessary jargon."

Hands-on practice building the model.

"Building the DCF model in Excel step-by-step was incredibly helpful to see the concepts come to life."

"The practical exercises using Excel really solidified my understanding and gave me confidence."

"I appreciated the detailed walk-through of creating the financial model within Excel."

"The provided Excel file and guidance made the practical part very effective."

Some topics could use more detail.

"Wish there was more detail on sensitivity analysis variations or edge cases."

"An advanced module covering more complex scenarios would be great."

"Felt some areas were a little brief, could expand on nuances for experienced users."

Activities

Be better prepared before your course. Deepen your understanding during and after it. Supplement your coursework and achieve mastery of the topics covered in Step-by-Step DCF Valuation! with these activities:

Review Core Finance Concepts

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Reinforce your understanding of fundamental finance concepts like time value of money and discount rates, which are crucial for grasping DCF valuation.

Browse courses on Time Value of Money

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Review definitions of key terms.
Work through practice problems.
Summarize the concepts in your own words.

Review 'Investment Valuation' by Aswath Damodaran

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Deepen your understanding of valuation principles and techniques by studying a comprehensive resource on investment valuation.

View Investment Valuation, University Edition: Tools... on Amazon

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Read the chapters on DCF valuation.
Work through the examples in the book.
Compare Damodaran's approach to the course material.

Practice Calculating WACC

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Sharpen your ability to calculate the Weighted Average Cost of Capital (WACC) by working through a series of practice problems with varying inputs.

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Find sample company data online.
Calculate the cost of equity using CAPM.
Determine the cost of debt.
Calculate the WACC.

Four other activities

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Write a Blog Post on DCF Valuation

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Reinforce your learning by explaining the DCF valuation process in a clear and concise blog post aimed at other finance students.

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Outline the key steps of DCF valuation.
Explain the underlying concepts.
Provide examples and illustrations.
Edit and publish your blog post.

Build a DCF Model for a Real Company

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Solidify your understanding of DCF valuation by building a complete model for a publicly traded company, from gathering financials to creating outputs.

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Choose a company to analyze.
Gather historical financial data.
Project future financials.
Calculate the DCF valuation.
Present your findings.

Read 'Financial Modeling & Valuation' by Paul Pignataro

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Supplement your understanding of DCF modeling with a practical guide used in investment banking and private equity.

View Financial Modeling and Valuation: A Practical... on Amazon

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Read the sections on DCF modeling.
Review the case studies.
Compare the book's approach to the course's.

Analyze a Company's Sensitivity Analysis

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Deepen your understanding of sensitivity analysis by examining the sensitivity tables presented in a company's investor relations materials.

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Select a company with available investor materials.
Locate their sensitivity analysis tables.
Interpret the tables and their implications.
Write a summary of your findings.

Career center

Learners who complete Step-by-Step DCF Valuation! will develop knowledge and skills that may be useful to these careers:

Valuation Analyst

A Valuation Analyst specializes in determining the economic value of businesses or assets, often using a DCF model. This course is very helpful for a Valuation Analyst because it dives deep into creating a DCF model, step by step. The curriculum explores the essential components of a DCF, from forecasting financials to calculating the Weighted Average Cost of Capital, to running sensitivity analysis. The course provides a step by step approach to the most popular company valuation tool, which is a critical skill for anyone pursuing a role as a Valuation Analyst.

See salaries and explore the career path for Valuation Analyst

Financial Analyst

A Financial Analyst often uses valuation techniques such as Discounted Cash Flow, or DCF, to evaluate investment opportunities. This course provides a practical, step-by-step guide to constructing a DCF model, which is a core competency for a financial analyst. It covers how to collate forecast financials, determine the Weighted Average Cost of Capital, create defendable assumptions, and conduct sensitivity analysis, all of which are essential for a Financial Analyst. The course teaches the need-to-know concepts required to model and analyze a company's worth using real world examples, which should prove helpful to anyone thinking of becoming a financial analyst.

See salaries and explore the career path for Financial Analyst

Investment Banking Analyst

An Investment Banking Analyst uses DCF valuation as a foundational tool for advising companies on mergers, acquisitions, and capital raising. This course on DCF valuation will help someone become an Investment Banking Analyst by teaching these exact core skills. The course's emphasis on a practical learning style, including creating outputs and sensitivity analyses, is directly relevant to this role. The course goes into the important inputs like company financials, weighted average cost of capital, and modeling in Excel, which is extremely valuable for anyone starting out as an Investment Banking Analyst.

See salaries and explore the career path for Investment Banking Analyst

Financial Modeling Analyst

A Financial Modeling Analyst creates financial models for various purposes, including company valuation, often using a DCF. This course on DCF Valuation will assist anyone who wants to become a Financial Modeling Analyst because it teaches you how to create a DCF model from scratch. The step-by-step focus on practical modeling in Excel makes this course very pertinent to the job. The course helps build a foundation in the core concepts needed to create an accurate and robust model, from finding company financials to calculating the Weighted Average Cost of Capital, thus helping to produce a robust analysis.

See salaries and explore the career path for Financial Modeling Analyst

Equity Research Analyst

An Equity Research Analyst uses valuation methods, including DCF, to assess the fair value of publicly traded companies. This course will be directly beneficial to someone who wants to be an Equity Research Analyst because the course teaches how to create detailed DCF model from start to finish. The course’s practical, step-by-step approach, covering areas such as creating assumptions, interpreting financial statements, calculating WACC, and creating sensitivities, will allow an aspiring Equity Research Analyst to immediately apply what they learn. The course provides real world examples of how to create the most popular company valuation tool used in finance.

See salaries and explore the career path for Equity Research Analyst

Private Equity Analyst

A Private Equity Analyst uses DCF valuation to assess potential investments in companies that are not publicly traded. This course provides a thorough understanding of DCF modeling, from gathering company financials to creating outputs and conducting sensitivity analysis. A Private Equity Analyst requires a strong grasp of valuation techniques, and this course’s hands-on approach in building a DCF model, as well as its focus on practical application of concepts, makes it a great starting point for someone interested in becoming a Private Equity Analyst. The insights taught in this course are essential for any aspiring valuation expert.

See salaries and explore the career path for Private Equity Analyst

Corporate Finance Analyst

A Corporate Finance Analyst performs valuations for strategic planning, capital budgeting, and mergers and acquistions. This course is highly relevant to this role, as it gives clear and actionable steps to performing a DCF analysis. The course’s practical focus on building DCF models, including gathering financial forecasts and creating outputs, is important for a Corporate Finance Analyst. The course's use of practical exercises in Excel, and the focus on industry standard outputs in Powerpoint will help anyone who wants to use DCF modeling in their role as a Corporate Finance Analyst.

See salaries and explore the career path for Corporate Finance Analyst

Portfolio Manager

A Portfolio Manager uses valuation techniques, including DCF, to make investment decisions, and this course can help someone who wants to become a Portfolio Manager. The course provides an understanding of DCF valuation, including how to formulate assumptions, calculate WACC, and perform sensitivity analysis. Because this course's practical focus is on developing a DCF model, it aligns well with the needs of a Portfolio Manager who needs to assess if a company is a good investment.

See salaries and explore the career path for Portfolio Manager

Business Development Analyst

A Business Development Analyst uses valuation techniques to assess potential partnerships, acquisitions, and new ventures. This course’s coverage of the DCF model makes it very helpful for a Business Developement Analyst. The detailed exploration of creating a DCF model, including finding financials, creating assumptions, and calculating the WACC, builds a strong foundation for this role. This course may assist someone wanting to become a Business Development Analyst with the skills needed to successfully evaluate business opportunities.

See salaries and explore the career path for Business Development Analyst

Hedge Fund Analyst

A Hedge Fund Analyst uses detailed financial analysis, including DCF valuation, to make investment recommendations, and this course may be helpful to someone who wants to become a Hedge Fund Analyst. The course teaches how to create a DCF from start to finish, including how to find forecast financials, how to calculate WACC, and how to create assumptions. The hands-on component of the course, including the calculation of sensitivities and outputs, will be an aid in moving into the Hedge Fund Analyst role.

See salaries and explore the career path for Hedge Fund Analyst

Credit Analyst

Credit Analysts assess the creditworthiness of borrowers, and a DCF model may be used in some situations. A course on DCF valuation may be useful for someone seeking this role, as it can expand their understanding of how to use a DCF model. The course explores how to find financial forecasts, calculate WACC, and model in Excel. The practical focus on creating a DCF model, paired with the ability to create sensitivities, may assist someone in understanding debt repayment in the context of modeling.

See salaries and explore the career path for Credit Analyst

Management Consultant

A Management Consultant uses financial analysis to advise companies on strategy, operations, and finance, sometimes using the DCF valuation. This course may be useful for a Management Consultant, as it provides concrete steps to perform a DCF, from finding financial forecasts to modeling in Excel. The course's practical use of Excel coupled with real-world examples gives helpful insight into how the DCF is used, which may assist a Management Consultant.

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Financial Controller

A Financial Controller is a senior accounting role, however they may need to gain an understanding of how their company is valued. A course on DCF valuation may be useful for someone in this position as it presents a step-by-step approach to how a DCF is constructed and used in the real world. The practical nature of the course, which includes creating outputs and conducting sensitivity analysis, helps explain the important components of a DCF model.

See salaries and explore the career path for Financial Controller

Business Analyst

A Business Analyst performs market research, data analysis, and process improvement, and may need some understanding of how a company is valued. This course may be useful to a Business Analyst to better understand the company's worth, as the course provides a step-by-step approach to performing a DCF valuation. The course covers important topics such as the Weighted Average Cost of Capital and its components, and also teaches how to perform sensitivity analysis.

See salaries and explore the career path for Business Analyst

Real Estate Analyst

A Real Estate Analyst may use valuation methods like DCF to assess commercial real estate investments. This course may assist a Real Estate Analyst with the financial concepts and modeling skills required for valuing assets, even though the example companies in the course might not be real estate companies. The ability to break down financial forecasts and the WACC may help someone to model real estate assets.

See salaries and explore the career path for Real Estate Analyst

Step-by-Step DCF Valuation!

What's inside

Learning objectives

Syllabus

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Reviews summary

Practical step-by-step dcf valuation

Activities

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