Long story short have to do a DCF for an operating model I made. They only want 1 year forward estimates (quarterly). I know DCF are typically a couple years, so what changes do you need to make so that the 1 year DCF makes sense? Any insight is helpful. Thanks
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Exactly the same as a 10 year except just 1 year?
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No a 1-year DCF doesn't make sense. Why would you go through all that trouble instead of valuing it on NTM EPS multiple?
Interviewer probably wants to know he/she can build a dcf mechanically but doesn’t give a damn about projections
Then you should build a 5-year DCF, literally takes 10 more minutes but at least it's sensible. I would ding anyone who shows me a 1-year DCF.
I have a feeling they meant they want to a see 1yr integrated quarterly operating model, and then just a rough DCF (most likely 5 year) to see both approaches, but hard to say obvs with limited info. A 1yr DCF sounds super strange lol
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