I've watched multiple videos on DCFs and I still don't fully understand them. Ik the procedure but I don't know how to make the assumption for the future earnings. (I swear I'm not stupid lol)
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You multiply everything by 1.02 and you’re good
That’s the beautiful thing about assumptions. They’re completely made up. Then your MD asks you to pump them up and voila
You have to build an operating model that calculates free cash flow. Your inputs are informed by financials found in company filings or provided by management. Obviously there’s a lot of nuances in forecasting financials but you’ll spend your entire career refining that. Reading research reports (particularly initiating coverage) is a great way to start training that muscle. Hope this helps
thank uuu:)
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