DDM vs DCF
Currently I'm working for a greenfield investment firm essentially doing project finance for renewable energy. What I wanted to discuss was the use of various valuation methods, DDM vs (un)levered DCF's.
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DDM: Discounted value of dividend payments ( assuming we pay the maximum allowed dividends to HoldCo's and extract it from there to different projects or what not) --> Equity Value (obviously wouldn't give the same result as the below)
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Levered DCF: Discounted value of FCFE where the only difference between DDM would be the timing of the dividend or a country specific limitation, right? --> Equity Value
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Unlevered DCF: Discounted value of FCFF this has no regards to the financing structure of the project. --> Enterprise Value
Question/ discussion: I see many people say they wouldn't use a DDM for a valuation. However, in the above scenario, why would one not use it? It seems to be a more accurate valuation of the Equity, or am I missing something?
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