Valuation Base Date

Hi all,

Just to provide some context, I am designing a DCF valuation for a dental practice which has been operating for +20years and was purchased by another dentist in july/17. The dentist wants to now understand how much value he is adding to the business given his operational plan/CAPEX agenda. I have therefore been asked to make a theoretical valuation of the practice.

My question is regarding the base date and period of projection. Since we are already in the end of June 2018, I am inclined to use a base date of 1st of July/2018, project out the second semester of 2018 monthly (july to december), and then project the following periods on an annual basis. Do you agree with this methodology?

Worth mentioning that most of the expansion CAPEX has already been made (in 1Q18), so the model would not capture the negative cash flow of the expansion CAPEX. Having said that, should I simply project the cash flows as they are and simply create a "football field" analysis where the purchase price paid includes also the expansion capex made in 1Q18? How would you all approach the base date of projection and how would you reflect the capex?

Thank you in advance.

Stefan